Th3.1: Forward and Backward Vertical Integration Flashcards
1
Q
What is the one disadvantage?
A
firms have no expertise in the industry they took over
2
Q
What is integration?
A
growth through amalgamation, merger or takeover
3
Q
What is a merger or amalgamation?
A
where two or more firms join under common ownership
4
Q
What is a takeover?
A
when one firm buys another
5
Q
What is vertical integration?
A
the integration of firms in the same industry but at different stages in the production procecss
6
Q
How could it be backward integration?
A
if the merger takes the firm back towards the supplier of good
7
Q
How could it be forward integration?
A
when the firm is moving towards the eventual consumer of a good
