Diversification into Unrelated Businesses Can Add Value for Shareholders If

question 39

Multiple Choice

Diversification into unrelated businesses can add value for shareholders if:

• A) the brand is licensed to other users.
• B) retaining control of the economies of scope reduces transaction costs.
• C) the unrelated businesses have a high risk component.
• D) managers' pay is linked to the size of the firm and not profits.