Mergers and Acquisitions Are Often Driven by Such Strategic Objectives

question 59

Multiple Choice

Mergers and acquisitions are often driven by such strategic objectives as

• A) expanding a company's geographic coverage or extending its business into new product categories.
• B) reducing the number of industry key success factors.
• C) reducing the number of strategic groups in the industry.
• D) facilitating a company's shift from a low-cost leadership strategy to a focused low-cost strategy.
• E) lengthening a company's value chain and thereby putting it in a better position to deliver superior value to buyers.

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Definitions:

Constant Returns to Scale

A situation in production where increasing the amount of inputs results in a proportional increase in the output.

Long-run Total Costs

The aggregate expenses a firm incurs in the production of goods or services when all factors of production are variable.

Average-total-cost Curve

A graphical representation showing the average total cost of producing different quantities of a good or service, illustrating how costs vary with changes in output.

Average-fixed-cost Curve

A graphical representation showing how the average fixed cost of production decreases as the quantity of output increases.