Foundations of Financial Management
16th Edition
ISBN: 9781259277160
Author: Stanley B. Block, Geoffrey A. Hirt, Bartley Danielsen
Publisher: McGraw-Hill Education
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Question
Chapter 20, Problem 4DQ
Summary Introduction
To explain:Â The difference between vertical and horizontal integrations and the effect of the anti-trust policy on mergers.
Introduction:
Vertical integration:
A vertical integration is one in which the acquirement of firms with the same production process within the same industry is done.
Horizontal integration:
A horizontal integration is one in which the acquirement of firms with the same level of value chain in an industry is done.
Anti-trust policy:
Anti-trust laws are statues of the U.S. to ensure the prevention of consumer exploitation by implementing healthy competition in an open-market economy.
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