Among the value-neutral incentives to diversify, some come from the firm's external environment while others are internal to the firm. External incentives to diversify include:
A) the fact that other firms in an industry are diversifying.
B) pressure from stockholders who are demanding that the firm diversify.
C) changes in antitrust regulations and tax laws.
D) a firm's low performance.

Question

Quizplus · Accepted Answer

Changes in antitrust regulations and tax laws are external factors that can incentivize a firm to diversify, as they alter the external legal and financial environment in which the firm operates.

Among the Value-Neutral Incentives to Diversify, Some Come from the Firm's