Question

What kind of integration is vertical integration? When the government outlaws discrimination against both short and...

What kind of integration is vertical integration?

When the government outlaws discrimination against both short and tall people.

When two firms join together in a conglomerate merger.

When two firms related in the production process are owned by the same firm, as in a plywood manufacturer owning a logging company.

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Answer #1

In a vertical intergration, two companies that are each other's suppliers, manufacturers or customers are integrated. In a conglomerate, two different firms are joint together.

What kind of integration is vertical integration?

When two firms related in the production process are owned by the same firm, as in a plywood manufacturer owning a logging company.

A logging company is involved in the process of cutting tress and transporting them to the desired location. A plywood manufacturer would need a logging company as it's supplier. Hence, this is a vertical integration.

Please feel free to ask any doubt in the comment section.

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