A Large Fabricator of Building Components Purchased a Steel Company

question 39

Multiple Choice

A large fabricator of building components purchased a steel company to provide raw materials for its production process. This is an example of

• A) backward integration.
• B) economies of scale.
• C) forward integration.
• D) product differentiation.

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Definitions:

Demand Curve

A graphical representation showing the relationship between the price of a good and the quantity demanded by consumers at each price level.

Consumer Surplus

The discrepancy in the total amount anticipated to be paid by consumers and the amount that is actually paid for a product or service.

Shipping Increases

A rise in the cost or amount required to transport goods from one location to another, potentially affecting trade and sales prices.

Decertification

The process by which a labor union is removed as the representative of the employees in a bargaining unit, typically through a vote by the employees.