In which of the following instances is retrenching to a narrower diversification base NOT likely to be an attractive or advisable strategy for a diversified company?
A) when a diversified company has struggled to make certain businesses attractively profitable
B) when a diversified company has too many cash cows
C) when one or more businesses are cash hogs with questionable long-term potential
D) when businesses in once-attractive industries have badly deteriorated
E) when a diversified company has businesses that have little or no strategic or resource fits with the "core" businesses that management wishes to concentrate on

Question

Quizplus · Accepted Answer

When a diversified company has too many cash cows, which generate steady profits, retrenching to a narrower diversification base may not be an attractive or advisable strategy as it could limit the potential for growth and future profitability.

In Which of the Following Instances Is Retrenching to a Narrower