The Quickest and Easiest Way for a Firm to Diversify

question 9

True/False

The quickest and easiest way for a firm to diversify its portfolio of businesses is to make acquisitions.

---

Definitions:

GAAP

A set of widespread accounting rules and standards, referred to as Generally Accepted Accounting Principles, used for financial reporting.

Fair Value

The estimated market value of an asset or liability, reflecting the amount at which it could be bought or sold in a current transaction between willing parties.

Residual Value

The estimated amount that an asset will be worth at the end of its useful life, often used in calculating depreciation and lease payments.

Straight-Line Method

The Straight-Line Method is a way of allocating the cost of an asset evenly over its useful life, commonly used in depreciation and amortization calculations.