A salad dressing company buys a large olive grove. The olive grove produces olive oil, a key ingredient in many salad dressings. The salad dressing company is practicing which of the following?

1) Concentration
2) Forward vertical integration
3) Backward vertical integration
4) Horizontal integration

The salad dressing company is practicing backward vertical integration by buying an olive grove to produce olive oil, a key ingredient in salad dressings.

Explanation:

The salad dressing company is practicing backward vertical integration. Vertical integration refers to a company acquiring other companies that encompass all aspects of a product's lifecycle. In this case, the salad dressing company has bought an olive grove to produce olive oil, which is a key ingredient in many salad dressings. By owning the source of the raw material, the company now has more control and can ensure a steady supply of olive oil for its salad dressings.

Examples of backward vertical integration in other industries include a soda company buying a sugar cane plantation or a car manufacturer acquiring a tire company.

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A salad dressing company buys a large olive grove. The olive grove produces olive oil, a key ingredient in many salad dressings. The salad dressing company is practicing which of the following?1) Concentration2) Forward vertical integration3) Backward vertical integration4) Horizontal integration

Answer :

Final answer:

Explanation:

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