A possible advantage of a horizontal merger for the economy is that
A)the merging firms could avoid losses.
B)the merged firm might reap economies of scale which could translate into lower prices.
C)the degree of competition in the industry will be intensified.
D)the government stands to collect more corporate income tax revenue.

Question

Quizplus · Accepted Answer

A horizontal merger could lead to economies of scale which could result in lower prices for consumers. This could benefit the economy by improving overall purchasing power and stimulating demand.

A Possible Advantage of a Horizontal Merger for the Economy