Related and Unrelated Diversification

  1. Why do companies diversify? When do companies consider diversification? What are the advantages of diversification.
  2. Describe related and unrelated diversification, and why a company would choose one diversification method or the other.
  3. Describe what can cause diversification to fail.
  4. When seeking to enter a new industry, some companies decide to acquire another company. Describe the advantages and disadvantages a company may face when exploring acquisition to enter a new industry.

 

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