When Executives Embark on Diversification Because They Desire to Build

question 38

Multiple Choice

When executives embark on diversification because they desire to build a larger company, they are said to be engaging in ________.

• A) risk reduction
• B) empire building
• C) dominant logic
• D) scope building

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Definitions:

Business Managers

Individuals responsible for overseeing the operational, financial, and strategic management of a company or a specific department.

Operating Activity

Financial activities directly related to the core business operations, including cash flows from selling goods and services.

Statement of Cash Flows

This financial document summarizes the cash and cash equivalents entering and leaving a company, highlighting cash flows from operating, investing, and financing activities.

Investing Activity

Financial actions related to the purchase and sale of long-term assets and other investments not considered cash equivalents.