The Two Biggest Drawbacks or Disadvantages of Unrelated Diversification Are

question 1

Multiple Choice

The two biggest drawbacks or disadvantages of unrelated diversification are

• A)the difficulties of passing the cost of entry test and the ease with which top managers can make the mistake of diversifying into businesses where competition is too intense.
• B)the difficulties of capturing financial fit and having insufficient financial resources to spread business risk across many different lines of business.
• C)the demanding managerial requirements and the limited competitive advantage potential due to lack of cross-business strategic fit benefits.
• D)ending up with too many cash hog businesses and too much diversity among the competitive strategies of the businesses it has diversified into.
• E)the difficulties of achieving economies of scope and conflicts/incompatibility among the competitive strategies of the company's different businesses.

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