Vertical Integration Strategies Can Aim at

question 68

Multiple Choice

Vertical integration strategies can aim at

• A) full integration (participating in all stages of the industry vertical chain).
• B) partial integration (building positions in selected stages of the value chain).
• C) tapered integration (involves both outsourcing and performing the activity internally).
• D) forward integration (value chain activities performed by distributors) or backward toward suppliers.
• E) All of these answer choices are correct.

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Definitions:

Seasonal Peaks

Periods within a year marked by a higher than average demand, sales, or activity in certain industries due to seasonal factors.

Temporary Working Capital

Funds a company temporarily needs to cover its short-term obligations.

Permanent Working Capital

The minimum amount of working capital a company needs to sustain its daily operations continuously.

Aggressive Working Capital Policy

A strategy involving higher levels of current assets relative to liabilities, aiming for growth but increasing liquidity risk.