The joining of a firm with another to which it sells an output or from which it buys an input is known as
A) a conglomerate merger.
B) a horizontal merger.
C) a vertical merger.
D) economies to scale.

Question

Quizplus · Accepted Answer

A merger in which a firm joins with another firm that it sells an output to or buys an input from is known as a vertical merger. A conglomerate merger is a merger in which firms in completely unrelated industries merge, while a horizontal merger is a merger between companies that operate in the same industry. Economies of scale refer to the cost advantages a firm experiences when it increases its level of output.

The Joining of a Firm with Another to Which It