A Manager in Your Company Is Proposing the Acquisition of Taylor

question 100

Multiple Choice

A manager in your company is proposing the acquisition of Taylor Company, which has developed a new, innovative product, instead of adopting a strategy of developing new products in-house.All of the following arguments are correct EXCEPT:

• A) the acquisition of Taylor should be primarily for defensive rather than strategic reasons.
• B) research suggests that acquisition strategies are a common means of avoiding risky internal ventures.
• C) the outcomes of acquisitions can be estimated more easily and accurately than the outcomes for an internal product development process.
• D) acquisitions could become a substitute for innovation within your firm.

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Definitions:

Federal Trade Commission

A US government agency whose primary purpose is to enforce civil antitrust law and promote consumer protection.

Interstate Commerce

The trade, traffic, or transportation of goods, services, or money across state boundaries within the United States, regulated by federal government.

Price Discrimination

A pricing strategy where identical or very similar goods or services are sold at different prices by the same provider in different markets or to different buyers.

Willingness to Pay

The highest price a consumer is prepared to pay for a good or a service.