Which of the Following Is a Not a Reason for a Business

question 18

Multiple Choice

Which of the following is a not a reason for a business combination to take place?

• A) Cost savings through elimination of duplicate facilities.
• B) Quick entry for new and existing products into domestic and foreign markets.
• C) Diversification of business risk.
• D) Vertical integration.
• E) Increase in stock price of the acquired company.

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Definitions:

Autonomous Consumption

The level of consumption that occurs when income is at zero, representing the expenditures that consumers must make even when they have no income.

Disposable Income

The fiscal resources available to households for allocation towards saving and spending post income tax adjustments.

Autonomous Consumption

The portion of consumption spending that does not change with changes in income level, reflecting basic consumption needs.

Disposable Income

Disposable income is the amount of money that households or individuals have available for spending and saving after income taxes are accounted for.