The Distinguishing Factor Between Unrelated and Related Diversification Strategy Is

question 39

Multiple Choice

The distinguishing factor between unrelated and related diversification strategy is that a firm using unrelated diversification strategy:

• A) has numerous businesses that are linked in some manner.
• B) manages several businesses with no reasonable connection.
• C) focuses on one specific product,typically in one market.
• D) develops core competencies using its resources and capabilities.

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Definitions:

Terminal Values

estimate the value of an investment, business, or project beyond the forecast period when future cash flows can be estimated.

Future Value Formulas

Mathematical equations used to calculate the amount of money an investment will grow to at a future date.

Cash Flows

The overall volume of funds moving into and exiting a firm, which is crucial for its liquidity status.

Sale of Old Equipment

The process of disposing of outmoded or surplus equipment, typically to free up space or raise funds.