Question

Which of the following is a result of horizontal integration in terms of Porter's five forces model?

A. The industry structure becomes less consolidated.
B. There is a reduction of excess capacity in the market.
C. The industry structure becomes potentially less profitable.
D. There is an increase in rivalry among existing firms.

Answer 1

Horizontal integration in terms of Porter's five forces model can result in an increase in rivalry among existing firms. Option D

Step-by-step explanation:

Horizontal integration refers to the consolidation of companies at the same stage of production in the same industry. In terms of Porter's five forces model, horizontal integration can result in an increase in rivalry among existing firms.

This is because when companies merge or acquire each other, there are fewer competitors in the market, leading to intensified competition and potentially higher levels of rivalry. This can result in price wars, aggressive marketing tactics, and increased efforts to gain market share. Option D