Which of the Following Is an Example of a Horizontal

question 43

Multiple Choice

Which of the following is an example of a horizontal growth strategy?

• A) A manufacturing firm acquires a firm in the online retailing space
• B) A firm introduces products in a new product category
• C) A firm merges with several other firms such that it owns consecutive stages of the value chain.
• D) An electronics company acquires another electronics firm that produces the same

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Definitions:

Specialization

The process of concentrating on and becoming expert in a particular subject or skill, often leading to increased efficiency and productivity.

Gains From Trade

The extra output that trading partners obtain through specialization of production and exchange of goods and services.

Comparative Advantage

The ability of an entity to produce a good or offer a service at a lower opportunity cost than its competitors, leading to more efficient international trade.

Domestic Opportunity Cost

The cost of forgoing the next best alternative use of resources within a particular country when choosing one economic action over others.