To avoid the situation where a localized economic downturn eliminates the income of the company, which type of diversification should a company practice?

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Quizplus · Accepted Answer

Geographic diversification involves expanding a company's operations to different countries or regions. This type of diversification can reduce risks associated with localized economic downturns because the company is not solely reliant on one region for revenue. By expanding to different regions, the company can spread out its risk and avoid being impacted by a downturn in any one area. Asset diversification involves investing in non-related assets, while conglomerate diversification involves expanding into unrelated businesses. Revenue diversification involves expanding a company's product line or customer base within its existing market. Investment capital diversification involves diversifying a company's investment portfolio.

To Avoid the Situation Where a Localized Economic Downturn Eliminates