Larry's Company Is in the Process of Buying a Smaller

question 132

Multiple Choice

Larry's Company is in the process of buying a smaller competitor and incorporating that company's resources into his business. This is an example of which of the following types of strategies?

• A)merger
• B)retrenchment
• C)acquisition
• D)stability

---

Definitions:

Opportunity Cost

The cost of foregoing the next best alternative when making a decision, highlighting the trade-offs involved.

Interest

The cost of borrowing money, typically expressed as a percentage of the amount borrowed, paid by the borrower to the lender for the use of their funds.

Expected Profit Rate

The forecasted return on investment, predicting the percentage of profit relative to costs.

Investment

The allocation of resources or capital to create profit in the future.