What is a possible advantage of a horizontal merger for the economy?
A)The merging firms could avoid losses.
B)The merged firm might reap economies of scale which could translate into lower prices.
C)The degree of competition in the industry will be intensified.
D)The government stands to collect more corporate income tax revenue.

Question

Quizplus · Accepted Answer

A horizontal merger could potentially result in economies of scale, meaning the merged firm may be able to produce goods or services more efficiently and at a lower cost. This could lead to lower prices for consumers, which may benefit the economy as a whole.

What Is a Possible Advantage of a Horizontal Merger for the Economy