Paper 2 · June 2019 · Financial Statements and Ratios
What term describes the merging of two firms that operate in the same industry and at the same stage of production, such as two fuel suppliers combining their operations?
Model answer
horizontal integration
Also accepted: horizontal merger
Explanation
Horizontal integration is the merging of firms in the same industry and at the same stage of production, e.g. two fuel suppliers combining to eliminate a competitor and gain economies of scale.
Derived from ZIMSEC Business_studies Paper 2, June 2019, Q4