Which of the Following Rationales for Pursuing Unrelated Diversification Is

question 117

Multiple Choice

Which of the following rationales for pursuing unrelated diversification is likely to increase shareholder value?

• A)to reduce risk by way of spreading the company's investments over a set of truly diverse industries
• B)to enable a company to achieve rapid or continuous growth
• C)to chance that market downtrends in some of the company's businesses will be partially offset by cyclical upswings in its other businesses
• D)to provide benefits to managers such as high compensation and reduced unemployment risk
• E)to restructure an underperforming business

Distinguish between literal and nonliteral (metaphorical) use of language.

Differentiate between equivalent and non-equivalent propositions.

Recognize the importance of word order in maintaining the meaning of a proposition.

Identify and understand metaphors within propositions.

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Definitions:

Central Tendency

The tendency to assign most ratees to middle-range job performance categories.

Halo Effect

A cognitive bias where the perception of one positive trait influences the perception of other traits.

Consensus Cues

Signals or indications that members of a group or audience are in general agreement about a particular idea or opinion.

Contrast Effect

Describes the enhancement or diminishment of perception, judgment, or behavior as a result of exposure to a contrasting reference point.