A characteristic of a horizontal merger is that Blank______.Multiple choice question.it is the combination of two or more firms in successive stages of productionit is a conglomerate merger involving the consolidation of two essentially unrelated firmsit is motivated by economies of scale in marketing, production, or salesit typically stabilizes supply and production and offers more control of these critical areas
Question
A characteristic of a horizontal merger is that Blank______.Multiple choice question.it is the combination of two or more firms in successive stages of productionit is a conglomerate merger involving the consolidation of two essentially unrelated firmsit is motivated by economies of scale in marketing, production, or salesit typically stabilizes supply and production and offers more control of these critical areas
Solution
The correct answer is: it is motivated by economies of scale in marketing, production, or sales.
Step 1: Understand the question. The question is asking for a characteristic of a horizontal merger.
Step 2: Review the options.
Option 1: it is the combination of two or more firms in successive stages of production. This is a characteristic of a vertical merger, not a horizontal merger.
Option 2: it is a conglomerate merger involving the consolidation of two essentially unrelated firms. This is a characteristic of a conglomerate merger, not a horizontal merger.
Option 3: it is motivated by economies of scale in marketing, production, or sales. This is a characteristic of a horizontal merger. In a horizontal merger, two companies that are in direct competition and share the same product lines and markets merge. This can lead to economies of scale in marketing, production, or sales.
Option 4: it typically stabilizes supply and production and offers more control of these critical areas. This is also a characteristic of a vertical merger, not a horizontal merger.
Step 3: Choose the correct answer. The correct answer is option 3: it is motivated by economies of scale in marketing, production, or sales.
Similar Questions
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