A Diversified Company Has a Parenting Advantage When It

question 64

Multiple Choice

A diversified company has a parenting advantage when it

• A)is more able than other companies to create positive collaboration within its portfolio for different specialty groups and geographic locations.
• B)is more able than other companies to boost the combined performance of its individual businesses through its high-level guidance,general oversight,and other corporate-level contributions.
• C)manages a set of fundamentally similar business operations inside fundamentally similar industries and environments.
• D)avoids acquiring undervalued companies and thus reduces risks.
• E)results in supporting short-term economic shareholder value.

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Definitions:

First-Degree Price Discrimination

Practice of charging each customer her reservation price.

Marginal Revenue

The increase in revenue resulting from the sale of one additional unit of a product or service.

Consumer Surplus

The difference between the total amount that consumers are willing and able to pay for a good or service and the total amount that they actually do pay.

Intertemporal Price Discrimination

A pricing strategy where a seller changes prices over time for the same product or service to maximize profits by taking advantage of differences in consumers' willingness to pay at different times.