Diversification Is Often a Poor Motive for Mergers Because

question 71

Multiple Choice

Diversification is often a poor motive for mergers because:

• A)Vertical integration is rarely successful
• B)Investors can diversify on their own account
• C)It does not produce economies of scale
• D)The increase in taxes overcomes gains in earnings

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Definitions:

Protocol

A set of rules and standards used to communicate between devices in a network, ensuring smooth transmission of data.

Modem

A device facilitating the transmission of data over telephone lines by converting digital signals to analog for transmission and back again for reception.

Local Firewall

A security system for computers that monitors and controls incoming and outgoing network traffic based on predetermined security rules, operating on a single machine.

Software Firewall

A program designed to prevent unauthorized access to or from a private computer network.