When technology in an industry is changing rapidly, a company pursuing a strategy of vertical integration may find itself:
A) locked into an old, inefficient technology.
B) able to sell its products at continually lower prices.
C) increasing returns on its assets.
D) establishing a monopoly in the industry.
E) lowering its cost structure.

Question

Quizplus · Accepted Answer

Vertical integration involves owning and controlling multiple stages in the production process, which can limit a company's ability to adapt to new technologies if they are already locked into an old, inefficient technology. This can lead to decreased competitiveness and higher costs.

When Technology in an Industry Is Changing Rapidly, a Company