Companies are interested in acquiring other firms even when the latter operate i

Question

Companies are interested in acquiring other firms even when the latter operate in totally unrelated realms of business. For instancce, Highways Industries manufacturing asphalt materials for road construction, acquired VIP Transport Ltd. and later acquired yet another company engaged in the business of food production. Such acquisitions are claimed to "work miracles". However, given the volatility of the stock market, and the slowing down of business, many companies wonder whether such acquisitions are becoming risky. At the same time, they also wonder if they are missing out on a great business opportunity if they fail to engage in this activity.Some research is needed here.

1. Given the above scenerio, discuss with reasons whether it will fall into the category of Applied or Basic research. Is this kind of acquisition an example of Vertical or Horizontal Integration? Explain. Apply the Hypothetico-Deduction method of research investigation to the situation above.

Explanation / Answer

1.Applied research Applied research is designed to the practical problems that exist in the modern world, rather than to just acquire knowledge for knowledge’s sake. 2. It is a vertical integration.. reason, deals with direct capital cash flows. Please rate

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