Th3.1: Impacts of Demergers

Question 1

Positive impact workers

Answer 1

separate firms may need their own managers and leaders so people could get a promotion

Question 2

Negative impact workers

Answer 2

the goal of making a firm more efficient may result in job losses

Question 3

Positive impact businesses

Answer 3

concentrating on a smaller core business may enable it to be more efficient and concentration may lead to more innovation and surviving higher competition

Question 4

Negative impact businesses

Answer 4

the smaller size of the business could lead to a loss of economies of scale and reduce efficiency

Question 5

Positive impact consumers

Answer 5

they may gain from innovation and efficiency, leading to a better products and cheaper prices

Question 6

Negative impact consumers

Answer 6

demerged firms may be less efficient through loss of economies of scale or raise prices/reduce quality or range of goods as they become motivated by profits