Future Business Leaders of America (FBLA) Agribusiness Practice Test

What are acquisitions in a business context?

1. The sale of a company

2. The purchase or receiving of goods

3. Divestitures of assets

4. Stock repurchase agreements

The correct answer is: The purchase or receiving of goods

In a business context, acquisitions refer specifically to the purchase or obtaining of another business or its assets. This process involves one company taking over another, which can result in a variety of outcomes, such as expanding market reach, increasing market share, or diversifying product lines. Acquisition typically entails a financial transaction where the acquiring company gains control over the target company's operations and assets. While the correct response indicates the general understanding of acquisitions in terms of obtaining resources, it's important to note that the term is primarily used to describe the context wherein one company purchases another company, rather than merely receiving goods as a standalone action. The other options involve different business transactions: the sale of a company pertains to selling ownership rather than acquiring. Divestitures of assets involve selling off parts of a business rather than acquiring new assets. Stock repurchase agreements concern the buyback of a company’s own shares rather than acquiring another entity. Each of these is distinct from the fundamental concept of acquisitions, which centers on gaining control over another business or its assets.