Suppose We Have Two Firms (Firm 1 & Firm 2)enter

question 24

Multiple Choice

Suppose we have two firms (Firm 1 & Firm 2) enter into a transaction where Firm 1 is upstream of firm 2 in a vertical chain.What term best describes the organization of the transaction where Firm 1 owns the assets of Firm 2?

• A)Backward Integration
• B)Forward integration
• C)Nonintegration
• D)Contractually unbound
• E)Contractually bound

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Definitions:

Constructs

Theoretical concepts or variables that are devised to understand and explain psychological phenomena or behaviors.

Behavior

Actions or reactions of an individual in response to external or internal stimuli.

Months

The twelve named periods into which a year is divided.

Constructive Alternativism

The idea that we are free to revise or replace our constructs with alternatives as needed.