Which of the Following Benefits of Diversification Explains the Idea

question 33

Multiple Choice

Which of the following benefits of diversification explains the idea that a firm with many business lines can reduce swings in value because it receives only a small percentage of its revenue from any one of those business lines?

• A)Use of internal capital markets
• B)Economies of scale and scope
• C)Economizing on transaction costs
• D)Diversifying shareholder portfolios
• E)Identifying undervalued firms

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Definitions:

Cognitive

Relating to the mental action or process of acquiring knowledge and understanding through thought, experience, and the senses.

Emotional

Pertaining to feelings or psychological states, often influencing behavior and perception.

Job Crafting Behaviours

The actions taken by employees to personally modify their job tasks, relationships, and perceptions to improve their job satisfaction and performance.

Structural Job Resources

Aspects of a job environment that facilitate the achievement of work goals, reduce job demands, and stimulate personal growth, learning, and development.