Which of the Following Is Not a Strategic Disadvantage of Vertical

question 60

Multiple Choice

Which of the following is not a strategic disadvantage of vertical integration?

• A) Vertical integration boosts a firm's capital investment in the industry, thus increasing business risk if the industry becomes unattractive later.
• B) Vertical integration backward into parts and components manufacture can impair a company's operating flexibility when it comes to changing out the use of certain parts and components.
• C) Vertical integration reduces the opportunity for achieving greater product differentiation.
• D) Forward or backward integration often calls for radically different skills and business capabilities than the firm possesses.
• E) Vertical integration poses all kinds of capacity-matching problems.

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