Faced with a Decline in Its Current Business,a Generic Drug

question 23

Multiple Choice

Faced with a decline in its current business,a generic drug manufacturer is planning a foray into design,and manufacture of re-locatable modular structures.Which diversification strategy is being employed by the company?

• A)Related diversification
• B)Backward integration
• C)Forward vertical integration
• D)Unrelated diversification

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Definitions:

Issuing Stock

The process by which a company sells new shares to investors to raise capital.

Financing Activity

Transactions and events where cash is raised from or repaid to investors, influencing the equity and debt of a company.

Cash

Money in the form of currency that can be used immediately for transactions.

General Ledger

The master set of accounts that summarizes all transactions occurring within an entity, serving as the main accounting record.