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Related Diversification Involves Growth by Acquiring New Businesses or Entering

question 191

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Related diversification involves growth by acquiring new businesses or entering business areas that are related to what the organization already does.


Definitions:

Dividends

Payments made by a corporation to its shareholder members, usually derived from the company's profits.

Market Price

The ongoing cost for buying or selling an asset or service within a market setting.

Acid-Test Ratio

A stringent indicator of a company's liquidity, calculated by dividing liquid assets excluding inventories by current liabilities.

Company

A business organization founded by a group of individuals dedicated to pursuing and administering a commercial or industrial venture.

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