Which of the Following Is a Benefit That Firms Should

question 55

Multiple Choice

Which of the following is a benefit that firms should expect to gain from the use of horizontal integration?

• A) Expanded control over stages of the supply chain
• B) Better realization of economies of scale
• C) Shared risk with another firm
• D) Reduced risk of holdup
• E) Reduced investments in noncore activities

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Definitions:

Manufacturer

A company or individual that produces finished goods from raw materials using various processes, tools, and machinery.

Economies Of Scale

The cost advantage achieved by an increase in production, leading to a lower cost per unit.

Facilities

Physical locations or infrastructures where business operations occur, including offices, factories, and warehouses.

Distributors

Entities engaged in the business of distributing goods, typically bought from manufacturers, directly to retailers or customers.