Final answer:
The activity that most likely indicates a firm is implementing a vertical integration strategy is (C) producing raw materials. This approach reduces a firm's reliance on suppliers and gives it more control over the manufacturing process, exemplified by strategies used in the past by John D. Rockefeller.
Step-by-step explanation:
Implementing a vertical integration strategy entails a company extending its operations within its supply chain. It means that the firm is involved in multiple steps of the production or distribution process. For instance, a firm that not only manufactures products but also begins to produce its own raw materials is pursuing vertical integration. This is done with the aim of controlling the production process, reducing dependency on suppliers, and potentially lowering costs.
The correct answer to the question about which activity most likely indicates that a firm is implementing a vertical integration strategy is (C) producing raw materials. When a firm starts producing its own raw materials, it integrates backwards within its supply chain, which is a classic approach to vertical integration. This can be seen in historical examples, such as the management strategies used by John D. Rockefeller in building his empire, where both horizontal integration (merging with or acquiring competitors) and vertical integration (controlling multiple stages of production) were employed.
In contrast, selling unprofitable divisions, offshoring low-skill jobs, aggressively selling a new product, and purchasing a competitor's firm may be indicative of different business strategies but not specifically of vertical integration. Offshoring, in particular, is related to companies moving operations to another country to lower costs but does not represent controlling more stages of production or distribution.