Vertical integration is attractive when ____________.
A) internal administrative costs are higher than transaction costs
B) transaction costs are higher than internal administrative costs
C) transaction costs and internal administrative costs are equal
D) search costs are higher than monitoring costs

Question

Quizplus · Accepted Answer

If transaction costs are higher than administrative costs, that is, those costs incurred when coordinating the activities elsewhere in the value chain, vertical integration becomes an attractive strategy.

Vertical Integration Is Attractive When ____________