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A jewelry manufacturer has recently acquired the mining company that supplies the precious metals used in its jewelry production.
What is this an example of?
Suggested Answer: D
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Backward vertical integration occurs when a company acquires a supplier or producer that is further upstream in the supply chain. In contrast, forward vertical integration happens when a company buys a retailer or distributor further downstream.
Note: Forward horizontal and backward horizontal integration do not exist---these are trick options. (See LO 1.2, p.42)
26 comments · newest first
RO
Rossana
2 months ago
I feel it's D) Backward vertical integration. They’re securing their resources directly.
DE
Derick
2 months ago
I lean towards C) Forward vertical integration. They’re expanding their production chain.
TY
Tyra
2 months ago
I disagree, it's B) Backward horizontal integration. They control the supply now.
LI
Lisha
3 months ago
I think it's A) Forward horizontal integration. Makes sense!
ME
Mee
3 months ago
I’m confused. Isn’t it just about getting more resources?
EM
Emile
3 months ago
I agree with Desire. It’s about controlling the supply chain.
DE
Desire
3 months ago
No, it’s D) Backward vertical integration. They own the source now.
RE
Reena
3 months ago
I think it's A) Forward horizontal integration. They’re expanding their control.
TR
Tracey
4 months ago
Yeah, I feel like it’s about controlling the supply chain. Definitely D.
BR
Brittney
4 months ago
I agree with Sommer. It makes sense to secure resources.
SO
Sommer
4 months ago
No, it’s D) Backward vertical integration. They’re taking over their supplier.
VE
Veronika
4 months ago
I think it's A) Forward horizontal integration. They’re expanding their control.
ST
Stephanie
4 months ago
Not sure this will actually benefit them in the long run.
GE
Gerald
4 months ago
Seems like a smart move for control over resources.
CO
Colene
6 months ago
Surprised they went for the mining company!
LE
Lemuel
6 months ago
I thought it was forward integration?
JA
Jade
6 months ago
That's definitely backward vertical integration!
MA
Margurite
6 months ago
Definitely not forward vertical integration.
AN
Andree
7 months ago
Surprised they went for the mining company!
FE
Felton
7 months ago
Wait, isn't it just backward integration?
CL
Cletus
7 months ago
I think it's forward horizontal integration, though.
DA
Daniel
7 months ago
That's backward vertical integration for sure!
AD
Adrianna
7 months ago
I’m confused about the terms, but I feel like this is definitely about vertical integration since it involves the supply chain.
WI
William
7 months ago
I practiced a similar question where a company bought its supplier, and I think that was called backward vertical integration.
JU
Jutta
8 months ago
I’m not entirely sure, but I remember something about forward and backward integration. This feels like it could be forward horizontal integration too, but that doesn't seem right.
TE
Terrilyn
8 months ago
I think this might be backward vertical integration since the manufacturer is acquiring a supplier.