Assume that Microsoft decides to invest some of its excess cash by acquiring Starbucks Coffee. This would be a ______.
A) conglomerate merger
B) vertical merger
C) horizontal merger
D) joint venture

Question

Quizplus · Accepted Answer

A conglomerate merger is when two companies from different industries or sectors come together. In this case, Microsoft is a technology company and Starbucks is a coffeehouse chain, so it would be considered a conglomerate merger. A vertical merger would involve companies in the same industry but different stages of production, and a horizontal merger would involve companies in the same industry and at the same stage of production. A joint venture is a partnership between two companies for a specific project or goal, but it is not the same as a merger.

Assume That Microsoft Decides to Invest Some of Its Excess