Diversifying into New Businesses Can Be Considered a Success Only

question 112

Multiple Choice

Diversifying into new businesses can be considered a success only if it

• A)results in increased profit margins and bigger total profits.
• B)builds shareholder value.
• C)helps a company escape the rigors of competition in its present business.
• D)leads to the development of a greater variety of distinctive competencies and competitive capabilities.
• E)helps the company overcome the barriers to entering additional foreign markets.

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Definitions:

Loanable Funds

The total resources or funds available for borrowing in the financial markets, used for investments and other purposes.

Interest Rate

The cost of borrowing money or the return for investing, typically expressed as a percentage of the principal amount per annum.

Lend

The act of giving something, usually money, to someone with the expectation that it will be returned or repaid, often with interest.

Interest Rates

The expense associated with lending money or the profit from saving it, represented as a percentage of the total amount lent or saved.