Which External Growth Strategy Involves Two or More Corporations Joining

question 19

Multiple Choice

Which external growth strategy involves two or more corporations joining in a stock exchange and from which only one corporation survives?

• A) mergers
• B) strategic alliances
• C) diversification
• D) acquisitions
• E) concentration

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Definitions:

Asset Allocation

The strategy of distributing investments among various asset classes, such as stocks, bonds, and cash, to achieve a desired risk-reward balance.

Stock Selection

The process of choosing stocks for investment based on criteria such as financial health, market position, and growth potential to maximize returns.

Bond Selection

The process of choosing bonds for investment based on factors such as yield, maturity, credit quality, and issuer.

Unique Risk

Also known as unsystematic or idiosyncratic risk, it refers to the risk associated with a particular company or industry that can be mitigated through diversification.