Which of the Following Is Not One of the Appeals

question 82

Multiple Choice

Which of the following is not one of the appeals of an unrelated diversification strategy?

• A) The ability to spread business risk over truly diverse industries (as compared to related diversification which is limited to spreading risk only among businesses with strategic fit)
• B) An ability to employ the company's financial resources to maximum advantage by investing in whatever industries/businesses offer the best profit prospects
• C) Superior top management ability to cope with the wide variety of problems encountered in managing a broadly diversified group of businesses
• D) A potential for achieving somewhat more stable corporate sales and profits over the course of economic upswings and downswings (to the extent the company diversifies into businesses whose ups and downs tend to occur at different times)
• E) The potential to grow shareholder value by investing in bargain-priced or struggling companies with big upside profit potential, turning their operations around fairly quickly with infusions of cash and managerial know-how, and then riding the crest of higher profitability

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Definitions:

Personal Biases

Prejudices or inclinations that affect an individual's views, decisions, and interactions, often unconsciously.

Applicant's Capabilities

The skills, qualifications, and experiences that a job applicant possesses, relevant to a specific job or task.

Socialization

The onboarding process through which new members learn the culture of an organization.

Casual Interactions

Informal exchanges or social contacts that occur naturally in the workplace or social settings.