A dance studio and a dancewear manufacturer decide to combine. This type of merger is called a ________.
A)vertical merger
B)horizontal merger
C)product extension merger
D)conglomeration

Question

Quizplus · Accepted Answer

A vertical merger occurs when two companies in different stages of the same industry combine. In this case, the dance studio and dancewear manufacturer are both in the dance industry, but operate in different stages (one provides instruction while the other creates products). Therefore, this is a vertical merger.

A Dance Studio and a Dancewear Manufacturer Decide to Combine