The fastest and easiest way for a firm to diversity its portfolio of businesses is through acquisition because:
A) of barriers to entry in many industries.
B) it is difficult and time intensive for companies to develop products that differ from their current product line.
C) innovation in both the acquired and the acquiring firm is enhanced by the exchange of competencies resulting from acquisition.
D) unrelated acquisitions are usually uncomplicated because the acquired firm is allowed to continue to function independently as it did before acquisition.

Question

Quizplus · Accepted Answer

Developing new products or businesses from scratch can be a complex and costly process, involving extensive research and development, marketing, and distribution efforts. Acquiring an existing business allows a firm to quickly and easily diversify its portfolio without investing significant resources into developing new products or business lines.

The Fastest and Easiest Way for a Firm to Diversity