Question 1(1 point)

Value creating reasons for diversification include all of the following, except:

Question 1 options:

Economies of scale

Financial economies

Market power

Economies of scope

Question 2(1 point)

Conglomerates are firms using the following strategy:

Question 2 options:

Dominant business diversification strategy

Single business diversification strategy

Unrelated diversification strategy

Related linked diversification strategy

Question 3(1 point)

____________ and ________________ are two ways diversification strategies can created value.

Question 3 options:

Diversifying employment risk, increasing managerial compensation

Organizational learning, increased proactiveness

Operational relatedness, corporate relatedness

Risk reduction, uncertainty avoidance

Question 4(1 point)

Research indicates that highest performance is associated with:

Question 4 options:

Dominant business diversification strategy

Related constrained diversification strategy

Unrelated diversification strategy

Related linked diversification strategy

Question 5(1 point)

Diversification strategy may be used to gain market power through the following mechanisms, except:

Question 5 options:

Multipoint competition

Gaining scale

Vertical integration

Restructuring of assets

Question 6(1 point)

Often, diversification provides benefits to top-level managers but not to shareholders.

Question 6 options:

True

False

Question 7(1 point)

Expanding a firm's portfolio of businesses tends to increase top managers pay.

Question 7 options:

True

False

Question 8(1 point)

Effectively, corporate-level strategies have to do with diversification.

Question 8 options:

True

False

Question 9(1 point)

Structural arrangements where less than 70% of revenue comes from the dominant business, and all businesses share product, technological, and distribution linkages, are described by:

Question 9 options:

Related constrained diversification strategy

Unrelated diversification strategy

Dominant business diversification strategy

Related linked diversification strategy

Question 10(1 point)

Risk reduction for firms and antitrust regulation are examples of:

Question 10 options:

Value-creating reasons for diversification

Value-neutral reasons for diversification

Value-reducing reasons for diversification

None of the above