Which One of the Following Is Not a Means of Building

question 82

Multiple Choice

Which one of the following is not a means of building and strengthening competitively valuable resources and capabilities?

• A) Engaging in experience-building activities such as collaborative efforts in R&D engineering and design.
• B) Shifting from decentralized to centralized decision making so as to give senior executives more authority and control in driving cultural change.
• C) Acquiring capabilities through mergers and acquisitions.
• D) Entering into collaborative partnerships with suppliers,competitors or other companies that possess needed expertise.
• E) None of these.

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Definitions:

Internal Rate of Return

The discount rate at which the net present value of all the cash flows (both positive and negative) from a project or investment equals zero.

Multiple IRRs

The situation where a project has more than one internal rate of return, occurring due to unconventional cash flows.

Reinvestment Assumption

The theory that cash flows will be reinvested at a constant rate, often used in financial modeling.

Cost of Capital

The rate of return that a business must achieve in order to generate value, representing the opportunity cost of investing capital in a specific business rather than in an alternative venture.