Which term describes growth achieved by expanding through acquiring or merging with another firm?

• A. Globalization
• B. Franchise
• C. External Growth
• D. Fixed Costs

Answer: (C)

External growth is growth achieved by expanding through acquiring or merging with another firm. This approach lets a company quickly gain size, market share, or capabilities by joining with or purchasing another business, rather than growing a little at a time from within. It often provides faster access to new markets, products, or technologies, and can create synergies such as shared distribution or reduced duplications.

Globalization refers to the broader process of international integration and exchange, not specifically a growth method. A franchise is a licensing model where one party uses another’s brand and business system, not a growth strategy in itself. Fixed costs are costs that stay the same regardless of output, unrelated to how growth is achieved.