When a company has cash in excess of the amount needed to maintain a competitive advantage in its core business,it will most likely pursue
A) taper integration.
B) full integration.
C) diversification.
D) long-term contracts.
E) strategic alliances.

Question

Quizplus · Accepted Answer

When a company has cash in excess of the amount needed to maintain a competitive advantage in its core business, it will most likely pursue diversification. This means that the company will invest their excess cash in a different line of business that is not related to their existing business. This strategy is often used to spread risk and generate additional revenue streams. Other options such as taper integration, full integration, long-term contracts, and strategic alliances are more focused on strengthening the core business rather than expanding into new markets.

When a Company Has Cash in Excess of the Amount