The Two Biggest Drawbacks or Disadvantages of Unrelated Diversification Are

question 64

Multiple Choice

The two biggest drawbacks or disadvantages of unrelated diversification are

• A)underemphasizing the importance of resource fit and the strong likelihood of diversifying into businesses that top management does not know all that much about.
• B)insufficient cash flows to finance so many different lines of business and a lack of uniformity among the strategies of the businesses it has diversified into.
• C)volatile sales and profits and making the mistake of diversifying into too many cash cow businesses.
• D)the difficulties of competently managing many different businesses and being without the added source of competitive advantage that cross-business strategic fit provides.
• E)over-investing in the achievement of economies of scope and the difficulties of achieving a good mix of cash cow and cash hog businesses.

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Definitions:

Generic Node Class

A node class designed to hold data of any type, making it versatile for building various data structures like linked lists or trees with generic data types.

Linked List

A data structure consisting of a sequence of elements, where each element points to the next element in the sequence, allowing for efficient insertion and removal.

Stack

A linear data structure that follows a Last In, First Out (LIFO) principle for adding and removing elements.

Linked List

A data structure consisting of nodes, each containing data and a reference (or link) to the next node in the sequence, facilitating dynamic memory management.