Imagine That You Have Been Hired by Bill Newlands, President

question 50

Multiple Choice

Imagine that you have been hired by Bill Newlands, President and COO of Constellation Brands (CB) , to review the beverage company's diversified portfolio of businesses. Of the analytical tools that you could use to assess CB's business lineup for adequate resource fit, which one would you not be likely to use?

• A)estimating whether the excess cash flows generated by cash cow businesses in CB's portfolio are sufficient to cover the negative cash flows of its cash hog businesses
• B)assessing whether or not CB's recently acquired businesses are acting to strengthen this company's resource base and competitive capabilities or whether they are causing its competitive and managerial resources to be stretched too thinly across its businesses
• C)determining whether or not the opportunity exists for CB to achieve 1 + 1 = 2 outcomes among CB's portfolio of brands
• D)analyzing whether or not CB has adequate financial strength to fund its different businesses and maintain a healthy credit rating
• E)conducting feasibility studies into whether or not CB possesses or can develop sufficient resource strengths and competitive capabilities to be successful in each of the businesses it has diversified into

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Definitions:

Offer

A proposal presented by one party to another with the intention to create a legally binding agreement upon acceptance.

Escrow Account

An escrow account is a financial arrangement where a third party holds and regulates payment of the funds required for two parties involved in a given transaction, ensuring fair and secure dealings.

Objective Theory

A legal principle stating that the terms of a contract are interpreted based on external expressions (actions, words) rather than internal intentions.

Offeror's Words

The specific language or phrasing used by the person making an offer in a contract scenario, which can impact the terms and acceptance of the contract.