Question

A company pursuing vertical integration can gain market power over its competitors through all of the following EXCEPT: a. avoidance of market costs. b. improved adjustment to technological changes. c. improved product quality. d. savings on operations costs.

Answer 1

Answer:

B. Improved adjustment to technological changes.

Explanation:

Vertical Integration: It is a strategy to gain competitive advantage by taking complete control over a few stages of production or distribution. The company implements vertical integration to reduce the cost of production, reduce dependence on others, improve the quality of the product, etc.

In the given case, the company pursuing vertical integration can gain market power over its competitors through improved quality, reduction in cost, and reduction in operation cost, however, it does not improve adjustment to technological changes.