Please complete Question 10ab

10.
(Economic Research)

Holloway, Lee and Shen (2014) study the
determinants of cross-border leveraged buyouts.

a) The authors present a stylized model of
the global competition among buyout firms.

i) What factors in the model determine the
number of acquisitions by buyout firm in each country?

ii) Can you think of any other factors that
likely play a role in the real world?

iii) Where do these other factors
implicitly enter the equation for the number of completed buyout deals by each
investor in each country?

b) The authors test the predictions of the
model using a sample of worldwide buyout deals.

i) Which two countries dominate as home
countries for buyout firms in the sample?

ii) How do the authors test the prediction
that transaction costs associated with remote ownership impact the number of
deals? How do they measure the theoretical cost mitigation ability?

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iii) Are results consistent with the
predictions of the model? How can you tell?