Answer:
Option A. There exist economies of scope between diversified business units
Explanation:
The reason is that diversification is lowering the industry risk of the business the company is in by investing in several other industries. This helps us to lower the risk and have a steady returns in the subsequent years. This means uncertainty related to cash flows is lowered and this has also increased the chances of cash surplus for subsequent years.
Furthermore, if the investments made in diversified business units possesses economies of scope, which means that we are in related diversification because we are manufacturing different but similar goods which are substitutes to each other from large to some extent. This brings economies of scope and would lower the total operating cost of company. Hence the <u>Option A</u> which says that economies of scope does add value to the company is the right option.
Option B is not preferable option as the option of investing in different businesses is choosen in the option A.
Option C is again the same as Option B and the difference is that it uses the word several unrelated businesses instead of comprehensive business portfolio which is the same thing. Hence <u>Option C</u> is also not preferable option here.
<u>Option D</u> is incorrect because when we acquire an organization it is the move of increase in risk portfolio because acquisitions are mostly not a sound investments and not a part of diversification strategy as the company is putting all the eggs in the single basket.
Yes, there are many savings accounts you can't touch for a period of time
Answer:
$ 102,100
Explanation:
Based on the scenario been described in the question the incremental Analysis for replacement of old equipment:
Cost of New used lift
$ 190,500
Saving in Incremental Cost of Repair of old lift
$ (45,000)
Reduction in Annual operating expenses = $25,600 * 6 years
$ (153,600)
Annual Rent revenue from new used lift = $11,000*6 years
$ (66,000)
Sale price of old lift
$ (28,000)
Saving in Incremental Costs
$ (102,100)
Net income increase
$ 102,100
Hence, the net income shall increase by $102,100 if the old liftis replaced.
Answer:
Answer B
Explanation:
Plaintiff attorney is the last resource for the damaged or injured party, that he/she can turn to. They usually represent those who suffered as a result of someone else's negligence and in the process cover all the costs and expenses of the trial. They cover all the financial costs in exchange of portion of Final verdict or settlement.
