PK0-004 Question #537: Real Exam Question with Answer & Explanation

The correct answer is C: Business split. A demerger is when a single company separates into two or more independent entities, making it a Business split (C). This is also called a spin-off or divestiture. A Business relocation (A) involves moving operations to a different physical location. A Business reorganization (B)

Question

The Chief Executive Officer (CEO) of a company announced that a demerger operation will be completed in the next nine months. Which of the following BEST describes the organizational change?

Options

ABusiness relocation
BBusiness reorganization
CBusiness split
DBusiness acquisition

Explanation

A demerger is when a single company separates into two or more independent entities, making it a Business split (C). This is also called a spin-off or divestiture. A Business relocation (A) involves moving operations to a different physical location. A Business reorganization (B) refers to restructuring internal departments or processes, not splitting into separate companies. A Business acquisition (D) is when one company purchases another - the opposite of a demerger.

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