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A good example of backward vertical integration is a: A. global public accounting firm acquiring a small local or regional public accounting firm. B. hospital opening up a nursing home for the aged. C.
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A good example of backward vertical integration is a: A. global public accounting firm acquiring a small local or regional public accounting firm. B. hospital opening up a nursing home for the aged. C. large supermarket chain getting into convenience food stores. D. railroad company acquiring a trucking company specializing in long-haul freight. E. crude oil refinery purchasing a firm engaged in drilling and exploring for oil.

User Bishoy Kamel
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Answer: E. crude oil refinery purchasing a firm engaged in drilling and exploring for oil.

Step-by-step explanation:

Backward integration occurs when Company A acquires Company B because Company B produces the inputs that goes into the manufacturing of the goods produced by Company A.

In the scenario in option E, a crude oil refinery produces goods such as gasoline and other types of fuel but they do this by refining crude oil which is what the firm that they purchased is engaged in acquiring. This is therefore backward integration.

User Alessandro Muntoni
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