Which of the Following Statements Is Not Generally True of a Diversification

question 12

Multiple Choice

Which of the following statements is not generally true of a diversification strategy based on the realization of economies of scope?

• A) The strategy requires the head office to evaluate each business unit as a stand-alone operation.
• B) The strategy allows a company to realize cost economies among business units.
• C) The strategy may allow a company to use shared resources more intensively, thereby realizing economies of scale.
• D) The strategy requires managers to be aware of the costs of coordination.
• E) The strategy requires close coordination among different business units.

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Definitions:

Accelerator Position

A measurement of the angle or level to which the accelerator pedal is depressed, influencing vehicle speed.

Analog Potentiometer

An electrical component that varies resistance in a circuit to control a device, often used to adjust levels such as volume.

Hall-effect TPS

A throttle position sensor using the Hall-effect principle to measure the position of the throttle in an engine, translating the throttle's position into an electrical signal.

Transmitting Torque

The process of transferring rotational force from one part of a mechanical system to another, typically via gears, belts, or shafts.