If one of the reasons P&G acquired Gillette was to gain greater market power in key industries, this would be an example of ________ economies.
A) technical
B) pecuniary
C) diversification
D) vertical

Question

Quizplus · Accepted Answer

Pecuniary economies refer to cost savings or increased market power achieved through financial means such as mergers and acquisitions. In this case, P&G's acquisition of Gillette was aimed at increasing its market power in the consumer goods industry, thus this would be an example of pecuniary economies. Technical economies refer to cost savings achieved through improvements in production processes, diversification economies refer to cost savings achieved through broadening a company's product line, and vertical economies refer to cost savings achieved through controlling multiple stages of the production process.

If One of the Reasons P&G Acquired Gillette Was to Gain