General Motors purchased Fischer Auto Body to produce bodies to place on a chassis.This transaction is best described as:

Question

Quizplus · Accepted Answer

Vertical integration refers to the acquisition of suppliers or distributors or both to achieve cost savings and improve efficiency in production. In this case, General Motors acquired Fischer Auto Body to have control over the entire production process, from the chassis to the body, which is an example of vertical integration.

General Motors Purchased Fischer Auto Body to Produce Bodies to Place