Hector wanted to grow his business beyond the food industry and started investing in clothing,toys,and travel companies. Hector's vice president did not agree with these investments and predicted a decline in profit. Predicting this decline in profit is contrary to which strategy?

Question

Quizplus · Accepted Answer

The vice president's prediction of a decline in profit is contrary to the portfolio strategy, which aims to balance the risk and return of the company's portfolio by investing in a variety of industries. The BCG (Boston Consulting Group) strategy involves categorizing a company's products into a growth-share matrix, the related diversification strategy involves investing in industries related to the company's current operations, and the acquisition strategy involves buying other companies to expand the business. None of these strategies are directly related to the vice president's concern about declining profits due to investing in new industries.

Hector Wanted to Grow His Business Beyond the Food Industry