The form of diversification in which the business units operated by a firm are highly related is called ________.
A) related diversification
B) unrelated diversification
C) vertical diversification
D) horizontal diversification

Question

Quizplus · Accepted Answer

Related diversification involves operating business units that are closely related to each other in terms of products, markets, or technologies. This allows the firm to leverage its core competencies and share resources across units, potentially achieving economies of scale and scope. Vertical diversification refers to expanding the firm's operations along the value chain, either upstream or downstream, while horizontal diversification involves entering new, unrelated businesses.

The Form of Diversification in Which the Business Units Operated