Which of the following forms of diversification occurs when a firm operates multiple businesses within the same industry?
A) Related diversification
B) Hierarchical diversification
C) Conglomerate diversification
D) Horizontal diversification

Question

Quizplus · Accepted Answer

Related diversification occurs when a company operates in multiple businesses that are related to each other, either in terms of products, markets, technology, or distribution channels. In this case, the firm is operating multiple businesses within the same industry, which suggests a related diversification strategy. Hierarchical diversification refers to a company moving into businesses that are upstream or downstream in the value chain. Conglomerate diversification refers to a company entering unrelated businesses, while horizontal diversification refers to a company entering businesses that are not related to its core business.

Which of the Following Forms of Diversification Occurs When a Firm