The Merger of Two Companies in the Same Industry That

question 49

Multiple Choice

The merger of two companies in the same industry that make products required at different stages of the production cycle is called:

• A)economies of scope.
• B)vertical integration.
• C)economies of scale.
• D)horizontal integration.
• E)efficiency gains.

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Definitions:

Merchandise Inventory

Merchandise inventory refers to the products a company has available for sale to customers at any given time.

Note Payable

A written promise to pay a specific sum of money to a party on demand or at a predetermined future date.

Account Payable

The amount of money owed by a business to its suppliers or creditors for goods and services purchased on credit.

Notes Payable

Liabilities represented by written promises to pay specific sums of money at future dates, typically evidenced by formal instruments of credit.