Question

Which of the following business combinations is a vertical integration? A. The corner gas station buys the competitor across the street and shuts them down to increase its own market share. B. The corner gas station and the competitor across the street agree to set their prices at the same level. C. The corner gas station acquires the gasoline distributor to ensure they can get gas in times of shortages. D. The corner gas station starts selling fireworks during December/January and June/July.

Answer 1

Answer:

  C. The corner gas station acquires the gasoline distributor to ensure they can get gas in times of shortages.

Explanation:

Vertical integration is the situation where the same company owns both the sources of supply and the distribution (retail) outlets. The description of (C) matches this definition.