Diversification Decisions by fiRms Involve the Following Key Issues

question 31

Multiple Choice

Diversification decisions by firms involve the following key issues:

• A)The attractiveness of the industry to be entered and the potential for competitive advantage
• B)The potential for the diversification to increase growth and reduce risk
• C)The opportunities for exploiting economies of scope in resources and capabilities
• D)The benefits of synergy relative to the costs or coordination.

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Definitions:

Corporate Ballot

A voting system utilized within corporations whereby shareholders vote on company matters, either in person at meetings or via proxy.

Disclosure Standard

Guidelines or rules that dictate the amount and type of information that must be revealed in a financial transaction or investment opportunity.

Supreme Court of Canada

The highest court in Canada, which serves as the final arbiter of legal disputes, interpreting the constitution, and assessing federal or provincial law issues.

Securities Administrators

Officials or agencies responsible for enforcing the laws and regulations that govern the securities industry.