The industry attractiveness test for evaluating whether diversification into a particular industry is likely to build shareholder value involves determining whether:

Question

Quizplus · Accepted Answer

The industry attractiveness test focuses on the potential profitability and investment returns of the target industry. Therefore, choice A is the best answer because it directly relates to this criterion. Choice B is not specific to the profitability of the target industry, but rather to the company's competitive advantage. Choice C places too much emphasis on shareholders' opinions rather than objective evaluations of profitability. Choice D is a factor to consider, but not as central as the profitability of the industry. Choice E is relevant but is subsumed under the broader criterion of whether the target industry is profitable.

The Industry Attractiveness Test for Evaluating Whether Diversification into a Particular