The Two Biggest Drawbacks or Disadvantages of Unrelated Diversification Are

question 102

Multiple Choice

The two biggest drawbacks or disadvantages of unrelated diversification are

• A) the difficulties of passing the cost-of-entry test and the ease with which top managers can make the mistake of diversifying into businesses where competition is too intense.
• B) the difficulties of capturing financial fit and having insufficient financial resources to spread business risk across many different lines of business.
• C) demanding managerial requirements and limited competitive advantage potential that cross-business strategic fit provides.
• D) Ending up with too many cash hog businesses and too much diversity among the competitive strategies of the businesses it has diversified into.
• E) the difficulties of achieving economies of scope and conflicts/incompatibility among the competitive strategies of the company's different businesses.

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Definitions:

Progressive Relaxation

A technique for reducing stress and anxiety by tensing and then relaxing each muscle group in the body sequentially.

Exposure Therapy

A psychological treatment that involves confronting fears and anxieties by gradual, controlled exposure to the objects, activities, or situations that cause them.

Systematic Desensitization

A behavioral therapy technique used to help individuals overcome phobias and anxiety disorders by gradually exposing them to the anxiety source while teaching them relaxation techniques.

Aversive Conditioning

is a form of behavioral training where a negative stimulus is paired with an undesirable behavior in order to reduce or eliminate that behavior.