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Henson Electric Is Interested in Diversifying into the Frozen Foods

question 93

Multiple Choice

Henson Electric is interested in diversifying into the frozen foods industry. The board of directors sees this as a risky move since the company can't capitalize on any of its existing markets or core strengths. Which type of growth strategy is Henson Electric considering?

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Definitions:

Profit-volume Chart

A graphical representation that shows the relationship between a business's profit and its volume of sales.

Total Fixed Cost

The sum of all costs that remain constant regardless of the level of production or business activity.

Fixed Costs

Expenses that do not change in proportion to the activity of a business, such as rent, salaries, and insurance.

Activity Changes

Adjustments or variations in the level of a company's activities, such as production volume or sales, that can impact its costs and operational efficiency.

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