The Three Tests for Judging Whether a Particular Diversification Move

question 36

Multiple Choice

The three tests for judging whether a particular diversification move can create value for shareholders are:

• A) the attractiveness test,the profitability test,and the shareholder value test.
• B) the strategic fit test,the competitive advantage test,and the return-on-investment test.
• C) the resource fit test,the profitability test,and the shareholder value test.
• D) the attractiveness test,the cost-of-entry test,and the better-off test.
• E) the shareholder value test,the cost-of-entry test,and the profitability test.

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Definitions:

IQ

Intelligence Quotient, a standardized score meant to measure human intelligence, derived from various tests assessing cognitive abilities.

Intellectual Functioning

The capacity to think, reason, solve problems, and understand complex ideas, often measured through intelligence quotient (IQ) tests.