When Are Capabilities-Motivated Acquisitions Essential

question 33

Multiple Choice

When are capabilities-motivated acquisitions essential?

• A) When industry conditions,like technology advances are central to growth and rivalry is intense
• B) When first-mover advantages for products or services can be added to the portfolio lineup
• C) When the acquired firm can be purchased at a discount due to underperformance
• D) When a market opportunity can slip by faster than a needed capability can be created internally
• E) When the capabilities involve tacit knowledge and complex routines

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Definitions:

Financing Commitment

An assurance provided by a lender indicating the terms under which they agree to lend money to a borrower.

First Mortgage

A primary lien on a property that has precedence over all other claims or liens in the event of default or sale.

Mortgage Assignment

The transfer of a mortgage from one party to another, either for the benefit of changing lenders or selling the debt to another entity.

Reed Bank

A submerged reef in the South China Sea, known for its disputed territorial claims and rich natural resources.