Horizontal integration can reduce Blank______.Multiple choice question.the threat of entryindustry consolidationbargaining power with suppliers in favor of the firmnon-price competition
Question
Horizontal integration can reduce Blank______.Multiple choice question.the threat of entryindustry consolidationbargaining power with suppliers in favor of the firmnon-price competition
Solution 1
The correct answer is "bargaining power with suppliers in favor of the firm". Horizontal integration can reduce a firm's dependency on suppliers, thereby increasing its bargaining power. This is because the firm can achieve economies of scale, which can lower production costs and make the firm less dependent on suppliers.
Solution 2
The correct answer is "bargaining power with suppliers in favor of the firm".
Horizontal integration is a strategy where a company acquires, mergers or takes over another company in the same industry value chain. This strategy can reduce the bargaining power of suppliers as the integrated firm can have a larger scale, potentially leading to cost advantages and increased market power. This can put the firm in a better position when negotiating prices and other terms with suppliers.
Similar Questions
True or false: A horizontal integration strategy leads to industry consolidation
Horizontal integration can Blank______.Multiple choice question.decrease the geographic scope of a firmhelp a firm improve its strategic position in an industrylower the cost of production through decreased economies of scope
How can horizontal integration increase product differentiation?Multiple choice question.by distributing high profit marginsby filling the empty spaces in a firm's offeringsby producing revenues from outsourcingby using international suppliers and distributors
When two competitors merge, leading to industry consolidation, they are engaging in Blank______.Multiple choice question.vertical integrationhorizontal integrationforward diversificationbackward integration
Which of the following is NOT an advantage for a firm of vertical integration? Reduced uncertainty The ability to erect entry barriers Economies of scale A greater range of products
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