If a company has an internal growth strategy, which statement is true?

• A. Growth mainly through acquiring other companies
• B. Growth by franchising
• C. Growth mainly through investment in new capabilities using existing resources
• D. Growth by outsourcing production

Answer: (C)

Internal growth means expanding using the company’s own resources and capabilities rather than by buying or partnering with others. When a firm invests in new capabilities—like upgrading equipment, training staff, developing new products, or expanding production capacity—it is building its capacity from within, which is the essence of organic, internal growth.

That’s why the statement about growth mainly through investment in new capabilities using existing resources is the best fit. It describes strengthening and extending what the company already has, rather than relying on external deals or arrangements.

The other approaches rely on external options: acquiring other companies to grow, franchising through external partners, or outsourcing production to third parties, which do not reflect internal growth built from the company’s own resources.