Non-redeployable durable assets that are dependent upon unique complementary and perfectly redeployable assets to achieve substantial value-added will typically be organized as
A) an export trading company
B) a spot market contract
C) a vertically integrated firm
D) an on-going relational contract
E) a joint stock company.

Question

Quizplus · Accepted Answer

Vertical integration is a method of organizing a company in which the company owns and operates all of the different stages of production and distribution of a particular product or service. This is a common strategy for non-redeployable durable assets that rely on unique complementary and perfectly redeployable assets to achieve significant value-added. Vertical integration ensures greater control over the supply chain and allows firms to better align investments in complementary assets. Other options such as export trading companies, spot market contracts, on-going relational contracts, and joint stock companies may not provide the necessary level of integration and control for this type of asset.

Non-Redeployable Durable Assets That Are Dependent Upon Unique Complementary and Perfectly