Explain How a Vertical Merger or an Agreement Between Two

question 42

Essay

Explain how a vertical merger or an agreement between two vertically integrated firms can be strategically useful even if it neither lowers transaction costs nor cuts the risks of opportunism.

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Definitions:

SWOT Analysis

SWOT Analysis is a strategic planning tool used to identify and assess an organization's Strengths, Weaknesses, Opportunities, and Threats.

Four Elements

The Four Elements traditionally refer to earth, water, air, and fire, considered as the fundamental building blocks of nature in ancient and medieval philosophy.

Core Competencies

The unique capabilities and resources a company possesses that give it a competitive advantage in its field or market.

Low-Cost Leadership

A strategy where a company becomes the lowest cost producer in its industry, offering products or services at the lowest price point to gain market share.