To test whether a particular diversification move has good prospects for creating added shareholder value,corporate strategists should use the

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The correct approach involves evaluating the attractiveness of the industry (to ensure it's a promising field), assessing the cost of entry (to ensure it's not prohibitively expensive), and determining whether the diversification will make the company better off (by either creating a competitive advantage or leveraging existing competencies). These criteria help ensure that the diversification move is likely to add value for shareholders.

To Test Whether a Particular Diversification Move Has Good Prospects