The Expression "Conglomerate Discount" Means

question 35

Multiple Choice

The expression "conglomerate discount" means:

• A)The ability of a widely diversified firm to exploit economies of scope to reduce its overall costs
• B)The willingness of stock exchanges to offer discounted listing fees in order to attract highly diversified firms
• C)The stock market tends to value diversified companies at less than their break-up value
• D)The lower rates of return that highly diversified companies offer to their shareholders.