One Strategic Fit-Based Approach to Related Diversification Would Be to

question 53

Multiple Choice

One strategic fit-based approach to related diversification would be to

• A)acquire rival firms that have broader product lines so as to give the company access to a wider range of buyer groups.
• B)acquire companies in forward distribution channels (wholesalers and/or retailers).
• C)expand into foreign markets where the firm currently does no business.
• D)diversify into new industries that present opportunities to transfer specialized expertise,technological know-how,or other valuable resources and capabilities from one business's value chain to another's.
• E)diversify into foreign markets where the firm has unrelated businesses.

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Definitions:

Steps

A sequence of actions or procedures taken in order to achieve a particular end.

Jensen Portfolio Evaluation Measure

The Jensen Portfolio Evaluation Measure is a performance metric that assesses the return of an investment portfolio while adjusting for risk, comparing it to the expected return of the market with a given risk level.

CAPM

The Capital Asset Pricing Model is a theoretical framework that explains how the expected return on assets, especially stocks, is related to their systematic risk.

Measure of Return

A financial metric used to quantify the performance of an investment by assessing the gain or loss it generates.