Which of the following is NOT one of the appeals of diversifying into unrelated businesses? a) The relative ease of growing shareholder value by capturing cross-business financial synergies that will quickly drive the company's overall financial performance to higher levels.
b) The ability to employ company's financial resources to maximum advantage by (1) investing in whatever industries offer the best profit prospects and (2) diverting cash flows from company businesses with lower growth and profit prospects to acquiring businesses with higher growth and profit potentials.
c) The potential to better stabilize company profitability over the course of economic upswings and downswings (because market downtrends in some of the company's businesses may be partially offset by cyclical upswings in its other businesses, thus producing somewhat less earnings volatility).
d) The ability to grow shareholder value by exploiting the business acumen of corporate executives in spotting bargain-priced companies with big upside profit potential or in quickly turning around distressed businesses with infusions of cash and superior managerial know- how. and expanding
e) The merits of scattering business risk over a set of truly diverse industries (as opposed to only owning businesses with related value chain activities).