A Company Should Pursue Related Diversification Instead of Unrelated Diversification

question 48

Multiple Choice

A company should pursue related diversification instead of unrelated diversification when the company's

• A) core skills are applicable to a wide variety of industrial and commercial situations.
• B) core skills are highly specialized and have few applications outside the core business.
• C) top managers are skilled at acquiring and turning around poorly run enterprises.
• D) main objective is to maximize growth.
• E) free cash flow is high enough that it has funds available for investment.

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Definitions:

Constructive Feedback

Feedback provided in a supportive manner, intended to address issues and promote positive development and improvement.

Detailed Instructions

Comprehensive and precise directions provided to guide someone in completing a task or procedure.

Divergent Taxonomies

Classification systems that branch out in different directions, reflecting varied criteria or perspectives in organizing information.

Behavior Categories

Classifications used to systematically organize and understand the various types of actions or reactions of individuals or groups.