What Is a Diversification Strategy? How Can a Firm Reduce

question 8

Essay

What is a diversification strategy? How can a firm reduce the risks associated with diversification?

---

Definitions:

Industrially Advanced

Describes countries, regions, or businesses that have highly developed and sophisticated manufacturing capabilities and technologies.

Mutually Beneficial Trade

Trade agreements between parties that provide gains or advantages to all involved, enhancing each party's welfare.

Relative Cheaper

The comparison of the cost of one product or service to another, indicating that the former is less expensive.

Labor-Intensive

Describing a process or industry that requires a large amount of labor to produce its goods or services.