In order to reduce production costs, Everlasting Tire decided to buy out a rubber plant and begin manufacturing their own rubber for their tires. The corporate strategy adopted by the company is known as:
A) concentration.
B) vertical integration.
C) related diversification.
D) unrelated diversification.
E) differentiation.

Question

Quizplus · Accepted Answer

Vertical integration is a corporate strategy to expand the organization's domain into supply channels or to distributors, generally to eliminate uncertainties and reduce costs associated with suppliers or distributors.

In Order to Reduce Production Costs, Everlasting Tire Decided to Buy