Which One of the Following Is NOT a Factor That

question 97

Multiple Choice

Which one of the following is NOT a factor that makes it appealing to diversify into a new industry by forming an internal startup subsidiary to enter and compete in the target industry?

• A) When internal entry is cheaper than entry via acquisition.
• B) When a company possesses the skills and resources to overcome entry barriers and there is ample time to launch the business and compete effectively.
• C) When adding new production capacity will not adversely impact the supply demand balance in the industry by creating oversupply conditions.
• D) When the industry is growing rapidly and the target industry is comprised of several relatively large and well-established firms.
• E) When incumbent firms are likely to be slow or ineffective in combating a new entrant's efforts to crack the market.

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