The manager of View Your World, a high- end window manufacturer, notices that the cost to purchase glass for their windows in the spot market has increased. As a result of the change, which of the following is true?
A)The manager has less of an incentive to integrate backward.
B)The manager has more of an incentive to integrate backward.
C)The manager has less of an incentive to integrate forward.
D)The manager has more of an incentive to integrate forward.

Question

Quizplus · Accepted Answer

With the increase in the cost of glass in the spot market, the manager of View Your World has a higher incentive to integrate backward by investing in glass production themselves. This would reduce their dependence on the spot market and possibly lower their costs in the long run.

The Manager of View Your World, a High- End Window