Vertical disintegration occurs when a company:
A) decides to exit industries to its core industry.
B) takes advantage of another company it does business with after the other company has made a substantial investment in assets to meet the needs of the company.
C) decides to acquire its suppliers and distributors.
D) uses its capital resources to purchase its competitor.
E) decides to sell its business model to another company.

Question

Quizplus · Accepted Answer

Vertical disintegration refers to the process of a company slimming down by exiting industries that are not its core industry. Therefore, choice A is the best option. The other options describe different strategies for growth and expansion, which are the opposite of vertical disintegration.

Vertical Disintegration Occurs When a Company