Which of the Following Economies of Scope Do Not Have

question 25

Multiple Choice

Which of the following economies of scope do not have the potential for generating positive returns for a firm's equity holders since the economies of scope can be realized by outside equity holders at a low cost by investing in a diversified portfolio of stock?

• A) shared activities
• B) diversification to maximize the size of a firm
• C) internal capital allocation
• D) exploiting market power

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Definitions:

Sexual Impulses

Innate drives related to sexuality and the desire for physical intimacy and connection.

Aggressive Impulses

Instinctive drives that prompt individuals to act or respond with hostility or violence.

Frustrated

Experiencing irritation or disappointment stemming from the incapacity to effect change or reach a goal.

Defence Mechanisms

Unconscious psychological strategies used to cope with reality and to maintain self-image by reducing anxiety arising from unacceptable or potentially harmful stimuli.