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Answer on Finance Question for LaMarcus

Question #5482
Corporations invest in other companies for all of the following reasons except to
A. Generate earnings
B. house excess cash until needed
C. Increase trading of the other companies' stock
D. Meet strategic goals
Expert's answer

C. Increase trading of the other companies' stock


Corporation invests in other companies because:

- wants to earn (A);

- it has free cash and don't need it at the moment (B);

- according to its strategy (D).

Corporation doesn't need increase of other company stock' because it doesn't guarantee some profits (economic or alternative) for corporation.

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