Which of the following generates operating cash flows over and above internal requirements?

**What is a cash cow business? generates operating cash flows over and above its internal requirements, thereby providing financial resources that may be used to invest in cash hogs, finance new acquisitions, fund share buyback programs, or pay dividends.


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Which of the following are negatives or disadvantages of pursuing unrelated diversification strategies?

which of the following are negatives or disadvantages of pursuing unrelated diversification strategies? no potential for competitive advantage beyond any benefits of corporate parenting and what each individual business can generate on its own.

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Which of the following is the best example of related diversification?

Which of the following is the best example of related diversification? stem from cost-saving strategic fits along the value chains of related businesses.


What is the industry attractiveness test how is it used to evaluate a diversified company’s business lineup Why is it relevant?

The industry attractiveness test: The industry to be entered through diversification must be structurally attractive (in terms of the five forces), have resource requirements that match those of the parent company, and offer good prospects for growth, profitability, and return on investment.


What are the two important pitfalls of an unrelated diversification strategy?

The two biggest drawbacks or disadvantages of unrelated diversification are: A. the difficulties of passing the cost-of-entry test and the ease with which top managers can make the mistake of diversifying into businesses where competition is too intense.


How would you determine whether or not your diversification strategy would be successful?

How would you determine whether or not your diversification strategy would be successful? Diversification would result in enhanced shareholder value. attractiveness test, the cost of entry test, and the better-off test.


Which one of the following is not among the conditions that make restructuring a diversified company’s business lineup and appealing strategic option?

Which one of the following is not among the conditions that make restructuring a diversified company’s business lineup an appealing strategic option? When the company lacks a strong global brand name and lacks the managerial know-how and technological expertise needed to achieve economies of scope.

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How would you explain the difference between a one business company and a diversified company?

In terms of strategy making, what is the difference between a one-business company and a diversified company? A. The first uses a business-level strategy, while the second uses a set of business strategies and a corporate strategy. The first uses a single-line strategy, while the second uses a multi-line strategy.


Which of the following is a diversified business with one major core business and a collection of small related or unrelated businesses?

All of these. Which of the following is a diversified business with one major “core” business and a collection of small related or unrelated businesses? Dominant Business Enterprise.


What is diversification in business strategy?

Diversification is a growth strategy that involves entering into a new market or industry – one that your business doesn’t currently operate in – while also creating a new product for that new market.


Which of the following is an example of a diversification strategy?

1) Which of the following is an example of diversification : The correct answer is e) Market expansion.


Which of the following is the most compelling reason for diversifying into a new business?

There are four most often cited reasons for diversification: the internal capital market, agency problems, increased interest tax shield and growth opportunities.


What are three tests for judging a diversification move?

Terms in this set (8) What are the three tests for judging whether a particular diversification move can create value for shareholders? The attractiveness test, the cost-of-entry test, and the better-off test.

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Should a company pursuing an unrelated diversification?

core skills are applicable to a wide variety of industrial and commercial situations. A company should pursue unrelated diversification instead of related diversification when: its core skills are highly specialized and have few applications outside its core business.


What is the benefit of calculating quantitative attractiveness?

What is the benefit of calculating quantitative attractiveness ratings for the industries a diversified company has invested in? -Attractiveness ratings help to identify competitively valuable resources and capabilities.


What does a competitive strength score above 5 Tell us about a diversified company’s position in the market?

What does a competitive strength score above 5 tell us about a diversified company’s position in the market? If a diversified company’s business units all have competitive-strength scores above 5, it is fair to conclude that its business units are all fairly strong market contenders in their respective industries.


Which of the following is an important appeal of a related diversification strategy?

Which of the following is an important appeal of a related diversification strategy? Offers opportunities to transfer skills, expertise, technical know-how, or other capabilities from one business to another.


Why do companies opt for diversification in unrelated fields?

Unrelated diversification lacks commonality in markets, distribution channels, production technology, and R&D thrust to provide the opportunity for synergy through the exchange or sharing of assets or skills.


When should a company diversify its business?

Diversification occurs when a business develops a new product or expands into a new market. Often, businesses diversify to manage risk by minimizing potential harm to the business during economic downturns.