For a Firm's Diversification to Be Considered Related Constrained

question 55

Multiple Choice

For a firm's diversification to be considered related constrained:

• A) more than 70% of its revenue must come from the dominant business,and all businesses share product,technological and distribution linkages.
• B) less than 70% of its revenue comes from the dominant business,and the businesses share product,technological and distribution linkages.
• C) between 70% and 80% of revenues come from a single business.
• D) a firm must be concentrated in a large number of very different industries.

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Definitions:

P(A|B)

The chance that event A will occur, assuming event B has occurred, indicative of a conditional probability.

P(B)

The probability of occurrence of event B in a statistical experiment.

P(A And B)

The likelihood that events A and B will happen simultaneously.

Independent Events

Two or more events are independent if the occurrence of one does not affect the probability of the other(s).