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JAMB Commerce 2000 Question 6

Question 6

Business Combinations

The measure of independence available to the individual business units that come together is the main difference between

  1. A.vertical and horizontal integration
  2. B.mergers and acquisitions
  3. C.consortium and amalgamation
  4. D.trust and cartel.
Show the answer and explanation

Answer: D (trust and cartel.)

Explanation

Firms in a cartel remain independent and only agree on prices or output; firms in a trust hand control to trustees and lose independence.