A Major Advantage of Diversification Is That Overall Monitoring Costs

question 60

True/False

A major advantage of diversification is that overall monitoring costs are reduced because each separate business comes under the control of corporate headquarters.

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Definitions:

Output to Supply

The process of producing and providing goods or services to meet demand.

Firms

Business organizations engaged in professional, commercial, or industrial activities, aiming to generate profits.

Average Product

The average amount produced by each unit of a variable factor of production.

Marginal Product

The additional output that is produced by adding one more unit of a specific input, ceteris paribus.