A Horizontal Merger

question 89

Multiple Choice

A horizontal merger

• A)is a merger between firms in the same industry.
• B)results in a trust (for example, the Standard Oil Company).
• C)is a merger between firms at different stages of production of a good.
• D)was illegal in the United States until the Federal Trade Commission Act was passed by Congress in 1914.

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Definitions:

Auto Parts Industry

Refers to the sector of the economy focused on the manufacturing, distribution, and retailing of vehicle parts and accessories.

Significantly Lesser Price

A sale or transaction price that is considerably lower than the usual or market value.

Franchisor

The owner of the trade name or trademark in a franchise.

Franchisee

An individual or company that is granted the right by a franchisor to conduct business under an established brand's trademark and business model.