The combining of two firms, one of which supplies goods to the other, is called a

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A vertical merger is the combining of two firms at different stages of the production process, where one firm supplies products or services to the other firm. In this case, one firm supplies goods to the other, indicating a vertical relationship, which makes E the correct choice. A conglomerate merger involves two firms with no common business areas; a horizontal merger involves two firms in the same industry; a competitive merger is not a commonly used term in the context of mergers and acquisitions; and a cartel is an illegal agreement between firms to limit competition.

The Combining of Two Firms, One of Which Supplies Goods