Strategic Business Unit (SBU)structures Are Best Suited for Corporations Pursuing

question 38

Multiple Choice

Strategic business unit (SBU) structures are best suited for corporations pursuing ________,whereas holding company structures are best suited for companies with ________ strategies.

• A) product-market diversification; international
• B) international diversification; product-market
• C) related diversification; unrelated diversification
• D) unrelated diversification; related diversification

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Definitions:

Cost Flow Assumption

An accounting principle that determines how costs are allocated to inventory and cost of goods sold, examples include FIFO, LIFO, and average cost methods.

Cost of Goods Sold

The immediate expenses related to the creation of products that a company sells.

Merchandise on Credit

Goods that have been sold but not yet paid for, implying that the buyer owes the seller money.

Gross Amount

The gross amount is the total figure before any deductions are made, such as expenses, taxes, or discounts.