Question

How did horizontal integration limit competition?

A. Fewer independently owned companies existed to compete.

B. Companies agreed not to compete, so they all made more money.

C. More small companies tried to supply raw materials to large companies.

D.Suppliers could not produce enough to serve horizontally integrated companies.

PLEASE HELP

Answer 1

Horizontal Integration is the business practice of acquiring or merging industry competitors into one large company. Typically, companies buy rival companies with the hope that the purchasing company will be able to reduce costs, increase market share, and overall profitability. Ultimately, the hope is that the purchasing company will increase in value.

However, this practice reduces the number of companies competing for market share relative to a certain product or service. It is easy to see that mergers and acquisitions eliminate competitors, thus reducing competition for market share. With fewer independent companies, competition will be limited to a few or maybe even one large company.

The practice or idea of acquiring or merging companies in direct competition with each other may limit competition and result in circumstances that do not benefit the consumer.

Answer 2

thanks...i have a question a 2nd question....how did a pool differ from a trust?
a)pools were larger than trusts
b)a trust limited competition, but a pool didn't
c)only vertically integrated companies formed pools
d)pools were made of independent companies, but a trust was not