The Two Most Compelling Reasons for a Company to Pursue

question 106

Multiple Choice

The two most compelling reasons for a company to pursue vertical integration (either forward or backward) are to

• A)strengthen the company's competitive position and/or boost its profitability.
• B)achieve product differentiation and/or lengthen the company's value chain to include more activities performed in-house and thereby gain greater ability to reduce internal operating costs.
• C)broaden the firm's product line and/or avoid the need for outsourcing.
• D)expand into foreign markets and/or control more of the industry value chain.
• E)enable use of offensive strategies and/or gain a first-mover advantage over rivals in revamping the industry value chain.

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Definitions:

Promotion

Marketing activities intended to increase the awareness, interest, and sales of a product or service.

Compensation Increase

An adjustment or rise in the salary or wages paid to an employee.