Final answer:
The correct answer is a joint venture, a business arrangement where multiple companies collaborate in a common facility, sharing assets, risks, and profits. This setup allows firms to achieve economies of scale and face industry-wide issues together.
Step-by-step explanation:
A functional arrangement in which two or more firms each manufacture products or provide services in a shared or common facility is known as a joint venture. In a joint venture, each of the participating companies contributes assets, shares risks, and takes part in the profits and operational decisions of the entity. This can often provide the companies with synergies and economies of scale that may not be achievable individually.
Competing corporations might join together in an association because there is strength in numbers, they often have common issues that may affect an entire industry, and they can collectively influence or benefit from governmental policies. A general partnership is another form of business organization where two or more people collaborate in owning and operating a business, sharing responsibilities as well as profits.