Which of the following statements is true concerning the use of mergers to reduce cyclicality and volatility?

The merger of large, public firms is a cost-effective way for shareholders to shed firm-specific risk due to cyclicality and volatility

II. The merger of a large firm with a small, private firm may reduce cyclicality and volatility risk for the small firm’s owner.

III. Mergers that reduce cyclicality and volatility may still result in additional costs that outweigh the benefits