The difference between a horizontal merger and a vertical merger isMultiple Choicetwo firms in unrelated industries merge in a horizontal merger, whereas firms that make and sell similar products to the same customers merge in a vertical merger.companies operating at different but related levels of an industry merge in a horizontal merger, whereas two firms in unrelated industries merge in a vertical merger.one corporation merges with one of its customers or suppliers in a horizontal merger, whereas a firm merges with its direct competitor in a vertical merger.firms that make and sell similar products to the same customers merge in a horizontal merger, whereas companies operating at different but related levels of an industry merge in a vertical merger.
Question
The difference between a horizontal merger and a vertical merger isMultiple Choicetwo firms in unrelated industries merge in a horizontal merger, whereas firms that make and sell similar products to the same customers merge in a vertical merger.companies operating at different but related levels of an industry merge in a horizontal merger, whereas two firms in unrelated industries merge in a vertical merger.one corporation merges with one of its customers or suppliers in a horizontal merger, whereas a firm merges with its direct competitor in a vertical merger.firms that make and sell similar products to the same customers merge in a horizontal merger, whereas companies operating at different but related levels of an industry merge in a vertical merger.
Solution
The correct answer is: "firms that make and sell similar products to the same customers merge in a horizontal merger, whereas companies operating at different but related levels of an industry merge in a vertical merger."
Here's why:
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A horizontal merger is a merger or business consolidation that occurs between firms that operate in the same industry, usually as competitors offering the same good or service. Horizontal mergers are common in industries with fewer firms, as competition tends to be higher and the synergies and potential gains in market share are much greater for merging firms in such an industry.
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A vertical merger is a merger between two companies that operate at separate stages of the production process for a specific finished product. These two companies have a buyer-seller relationship. The main reason for a vertical merger is to increase synergies, reduce costs, and increase efficiency.
So, the statement "firms that make and sell similar products to the same customers merge in a horizontal merger, whereas companies operating at different but related levels of an industry merge in a vertical merger" accurately describes the difference between a horizontal and vertical merger.
Similar Questions
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