Two long-time competitors, Freddie's Market and Greta's Groceries, recently issued an announcement stating their decision to merge. The statement claimed that the new company would have more financial resources, which would enable it to expand services and broaden offerings to customers. This proposed merger is an example of a horizontal merger.

a) true

b) false

Question

Business

Jett Sanchez

5 January, 09:36

Two long-time competitors, Freddie's Market and Greta's Groceries, recently issued an announcement stating their decision to merge. The statement claimed that the new company would have more financial resources, which would enable it to expand services and broaden offerings to customers. This proposed merger is an example of a horizontal merger.

a) true

b) false

+5

Answers (1)

Know the Answer?

Jacob Lloyd · Answer 1

True

Explanation:

Meaning of horizontal merger: Horizontal merger is a form of merger that occurs between companies functioning in the same line of business or the same industry. Simply put, a horizontal merger occurs when companies that offers same or similar products or services come together under single ownership for either financial and non-financial or both ...

Relating the meaning of horizontal merger to the question, the question said two long-time competitors, note competition is a rivalry to win, which means Freddie's Market and Greta's Groceries are in the same industry, the line of business. so therefore, for Freddie's Market and Greta's Groceries to come together to put resources together to expand and gain more market shares is an example of Horizontal Merger.

And the answer should be True