The Fastest and Easiest Way for a Firm to Diversity

question 48

Multiple Choice

The fastest and easiest way for a firm to diversity its portfolio of businesses is through acquisition because

• A)of barriers to entry in many industries.
• B)it is difficult and time intensive for companies to develop products that differ from their current product line.
• C)innovation in both the acquired and the acquiring firm is enhanced by the exchange of competencies resulting ᶠʳᵒᵐ ᵃᶜqᵘᶦˢᶦᵗᶦᵒⁿ.
• D)unrelated acquisitions are usually uncomplicated because the acquired firm is allowed to continue to function independently as it did before acquisition.

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Definitions:

Attitude

An inclination within the psyche to judge an observed entity with a level of preference or aversion.

Decisive Personality

A characteristic trait of individuals who can make choices quickly and confidently, often showing firmness and determination in their actions.

Cognitive Dissonance

A psychological concept referring to the mental discomfort experienced by a person who holds contradictory beliefs, ideas, or values.

Leon Festinger

An American social psychologist renowned for developing the theory of cognitive dissonance, which describes the psychological discomfort resulting from holding contradictory beliefs or attitudes.