When a firm is overly dependent on one or more products or markets, and the intensity of rivalry in that market is intense, the firm may wish to ____ by making an acquisition.
A) increase new product speed to market
B) broaden its competitive scope
C) increase its economies of scale
D) overcome entry barriers

Question

Quizplus · Accepted Answer

By making an acquisition, the firm can broaden its competitive scope and reduce its dependence on one or more products or markets, thus reducing the intensity of rivalry in that market. This can help the firm to diversify its portfolio and reduce the risk associated with being overly dependent on one product or market. Increasing new product speed to market or overcoming entry barriers may not necessarily address the issue of dependence on one or more products or markets, and increasing economies of scale may not be effective in reducing the intensity of rivalry in a highly competitive market.

When a Firm Is Overly Dependent on One or More