CIMA Exam CIMAPRA19-F03-1 Topic 5 Question 93 Discussion

Actual exam question for CIMA's CIMAPRA19-F03-1 exam

Question #: 93
Topic #: 5

A national rail operating company has made an offer to acquire a smaller competitor.

Which of the following pieces of information would be of most concern to the competition authorities?

AAfter the acquisition, the board proposes to increase prices on some routes not serviced by other rail operators.

BAfter the acquisition, the board proposes to withdraw some of the less profitable services.

CThe board informed a major institutional shareholder about the proposed acquisition before informing other shareholders.

DThe acquisition is likely to result in significant redundancies of staff currently working for the smaller rail operator.

Show Suggested Answer

Suggested Answer: A

by Alishia at Aug 05, 2024, 06:00 PM

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Ronnie

3 months ago

Hey, as long as they don't start playing 'Monopoly' with the rail lines, I think we're good!

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Dierdre

3 months ago

I hear the competition authorities are big fans of 'The Price is Right'. Gotta keep those bids low, folks!

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Elvis

2 months ago

C) The board informed a major institutional shareholder about the proposed acquisition before informing other shareholders.

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Howard

2 months ago

A) After the acquisition, the board proposes to increase prices on some routes not serviced by other rail operators.

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Ashton

3 months ago

Hmm, I'm torn between A and D. Increasing prices and job cuts - the authorities will have a field day with this one. Better bring your A-game!

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Marguerita

3 months ago

B seems like the right answer. Withdrawing services is a big no-no for the authorities. Gotta keep those options open!

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Tricia

2 months ago

Yeah, withdrawing services could limit choices for consumers.

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Carma

3 months ago

C) The board informed a major institutional shareholder about the proposed acquisition before informing other shareholders.

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Isreal

3 months ago

I agree, keeping options open is important for competition.

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Maybelle

3 months ago

B) After the acquisition, the board proposes to withdraw some of the less profitable services.

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Linsey

3 months ago

A) After the acquisition, the board proposes to increase prices on some routes not serviced by other rail operators.

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Asuncion

4 months ago

I see your point, Delpha. Both options D and A could raise red flags for competition authorities.

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Daniela

4 months ago

I'd say D. Redundancies are always a concern for competition authorities. Can't have a monopoly, am I right?

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Dominic

3 months ago

D) The acquisition is likely to result in significant redundancies of staff currently working for the smaller rail operator.

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Audry

3 months ago

A) After the acquisition, the board proposes to increase prices on some routes not serviced by other rail operators.

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Delpha

4 months ago

But what about option A? Increasing prices on routes not serviced by other operators could also harm competition.

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Belen

4 months ago

I agree with Daren, significant redundancies could impact competition in the industry.

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Daren

4 months ago

I think option D would be the most concerning to competition authorities.

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Keneth

4 months ago

Definitely C. Informing some shareholders before others is a clear case of insider trading. Not cool, guys.

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Candida

3 months ago

D) The acquisition is likely to result in significant redundancies of staff currently working for the smaller rail operator.

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Peggie

3 months ago

C) The board informed a major institutional shareholder about the proposed acquisition before informing other shareholders.

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Selene

3 months ago

B) After the acquisition, the board proposes to withdraw some of the less profitable services.

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Graciela

4 months ago

A) After the acquisition, the board proposes to increase prices on some routes not serviced by other rail operators.

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