The Merger Between Two General Merchandise Stores, Sears and Kmart

question 34

Multiple Choice

The merger between two general merchandise stores, Sears and Kmart, each of which carried some specialty items, most likely produced:

• A) neither economies of scope nor economies of scale.
• B) both economies of scope and economies of scale.
• C) economies of scope but not economies of scale.
• D) economies of scale but not economies of scope.

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Definitions:

Top-down Approach

Investment strategy that starts with global outlook and macroeconomic analysis before analyzing specific sectors and companies.

Operating Cash Flow

A measure of the amount of cash generated by a company's normal business operations.

Annual Sales

The total revenue a company generates from its operations over the course of a year.

Cash Expenses

Cash expenses are expenditures that a business or individual pays out in cash during a specified period, as opposed to non-cash expenses such as depreciation.