Question

A sound justification for unrelated diversification is that Multiple Choice 06 doing so can deliver enhanced shareholder value if an undervalued company can be purchased at a bargain price doing so can result in risk reduction by spreading a company's Investments over a set of diverse industries doing so can support managerial motives including the prospects for higher compensation doing so can stabilize earnings, i.e., market downtrends in some of the company's businesses will be partially offset by cyclical upswings its other businesses doing so can meet expectations for rapid or continuous growth

Answer 1

• Doing so can deliver enhanced shareholder value if an undervalued company can be purchased at a bargain price.

Unrelated justification can be defined as a finance-driven approach in which it creates the shareholder value.