Which one of the following is an example of BACKWARD integration?
A) an automobile company opening a plant to manufacture spark plugs
B) an airline company purchasing a retail clothing store
C) a personal computer manufacturer opening retail computer sales stores
D) a local bank opening branch offices in neighboring states

Question

Quizplus · Accepted Answer

Backward integration is when a company takes ownership or control of its upstream suppliers. In this case, the automobile company is acquiring a plant to manufacture spark plugs, which is a part of the production process that comes before the automobile assembly.

Which One of the Following Is an Example of BACKWARD