What Rationales for Unrelated Diversification Are Not Likely to Increase

question 96

Multiple Choice

What rationales for unrelated diversification are not likely to increase shareholder value?

• A) To reduce risk by spreading the company's investments over a set of truly diverse industries
• B) To enable a company to achieve rapid or continuous growth
• C) To chance that market downtrends in some of the company's businesses will be partially offset by cyclical upswings in its other businesses
• D) To provide benefits to managers such as high compensation and reduction in employment risk
• E) All of these

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Definitions:

Internal Consistency

A measure of the reliability of a psychological test or assessment, based on the correlation between multiple items or components of the test.

Alternate Form

A variant or different version of something, often used in the context of tests or assessments to reduce the effect of memorization or test practice.

Inter-rater

A measure of agreement among different people rating or assessing the same thing, ensuring consistency in evaluations across different observers.

Test-retest Reliability

The consistency of a psychological test or assessment over time when given to the same individuals.