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There are four basic types of diversification: concentric, conglomerate, forward and backward.

A) True
B) False

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Chapter 13 bankruptcy is similar to Chapter 11, but available only to large corporations.

A) True
B) False

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List some guidelines for when related diversification would be a particularly good strategy to pursue.

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Six guidelines for when relate...

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Mergers and acquisitions are created for all of the following reasons except to


A) gain new technology.
B) reduce tax obligations.
C) gain economies of scale.
D) smooth out seasonal trends in sales.
E) increase its number of employees

F) A) and E)
G) C) and E)

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A low-cost focus strategy offers products or services to a small range of customers at the lowest price available on the market.

A) True
B) False

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A leveraged buyout occurs when a firm's management and other private investors use borrowed funds to buy out the firm's shareholders.

A) True
B) False

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Since a combination strategy is not risky, many organizations pursue a combination of two or more strategies simultaneously.

A) True
B) False

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India commands over 60 percent of all backoffice outsourcing.

A) True
B) False

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Which level of strategy is most likely not present in small firms?


A) Corporate/company
B) Functional
C) Divisional
D) Operational
E) All of these are present in small firms

F) A) and D)
G) All of the above

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Whirlpool selling its struggling Hover floor-care business to Techtronic Industries is an example of which type of strategy?


A) related diversification
B) unrelated diversification
C) retrenchment
D) divestiture
E) liquidation

F) A) and D)
G) All of the above

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When an acquisition or merger is not desired by both parties, it is called a takeover or hostile takeover.

A) True
B) False

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Southwest Airlines selling tickets through Galileo is an example of which type of strategy?


A) forward integration
B) backward integration
C) horizontal integration
D) related diversification
E) unrelated diversification

F) A) and E)
G) A) and D)

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