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JAMB Economics 1989 Question 17

Question 17

Industrialisation

The merging of firms engaged in different stages of production and marketing is called

  1. A.external economies of scale
  2. B.vertical integration
  3. C.horizontal integration
  4. D.economic union.
Show the answer and explanation

Answer: B (vertical integration)

Explanation

Vertical integration joins firms at different stages of the same production chain, e.g. a manufacturer and its retailer.