Which Type of Multinational Diversification Occurs When the Parent Firm

question 32

Multiple Choice

Which type of multinational diversification occurs when the parent firm establishes foreign subsidiaries to produce intermediate goods going into the production of finished goods?

• A) Forward vertical integration
• B) Backward vertical integration
• C) Forward horizontal integration
• D) Backward horizontal integration

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Definitions:

Nominal-Level

Pertains to data classification into non-numeric categories that cannot be logically ordered or ranked.

Positive Correlation

A relationship between two variables where an increase in one variable is associated with an increase in the other variable.

Increases

A rise in magnitude, quantity, or value of something.

Negative Correlation

A bond between two variables in which the elevation of one corresponds with the reduction of the other.