Which of the Following Is an Advantage of Clustering

question 141

Multiple Choice

Which of the following is an advantage of clustering?

• A) It will encourage firms to tap into international markets for specialized labor.
• B) Firms in close proximity will not compete.
• C) It stimulates regional innovation and propels growth.
• D) Governments allocate scarce resources better than markets.
• E) The know-how in one firm can be kept from other firms in the locality.

---

Definitions:

Leveraged Buyout

The acquisition of another company using a significant amount of borrowed money to meet the cost of acquisition.

Collateral

Assets pledged by a borrower to secure a loan or credit, which the lender may seize if the borrower fails to repay the agreed amounts.

Acquisition

The process of obtaining control of another company or business entity through purchase or merger.

Poison Pills

Strategies employed by companies to deter hostile takeovers, making the company less attractive to potential acquirers.