Ch.12 MC

A firm can ensure a steady supply of raw materials by engaging in ________________ while it can increase its market share by engaging in _________________.

• A.backward integration … horizontal integration

• B. backward integration … lateral integration

• C. forward integration … horizontal integration

• D. forward integration … lateral integration

759Store, a local retailer of imported snacks, expand its business to sell cosmetics and skincare products. Which of the following is the LEAST likely motive behind the expansion?

• A. to reduce competition

• B.    to enjoy economies of scale

• C.    to extend its brand name to other products

• D.    to spread risk by business diversification

Hong Kong Television Network Limited (HKTV) has launched an online shopping platform “HKTV   Mall”. This expansion

(1)   helps spread business risk.

        (2)   ensures a higher profit for the company.

        (3)   extends its brand name to other markets.

• A.    (1) and (2) only

• B.    (1) and (3) only

• C.    (2) and (3) only

•  D.  (1), (2) and (3)

Giordano International Limited is a retailer of casual wear. It has launched the Giordano Ladies,   which provides luxury clothes and suits for ladies. It is an example of _______________ expansion.

• A.    horizontal

• B.    vertical

• C.    lateral

• D.    conglomerate

Toridoll Holdings Corporation, a leading company in the restaurant industry in Japan, acquired a Hong Kong noodle chain Tam Chai Yunnan Noodles (譚仔雲南米線). Which of the following is the LEAST likely motive behind the integration?

• A.    to secure the supply of factor inputs

• B.    to spread risk through product diversification

• C.    to enjoy economies of scale

• D.    to expand its business to other markets

A Hong Kong travel company offers package tours to Japan. It invested in building a hotel, which provides accommodation services to its tour members visiting Japan. Which of the following is most likely the motive behind the expansion?

• A.    to increase the market share

• B.    to secure the supply of factor inputs

• C.    to ensure a market outlet of its services

• D.    to reduce competition

ABC Diamond Cutting Factories expand its business as follows:

To ABC Diamond Cutting Factories, the types of expansion shown by X and Y are ________________ expansion and ________________ expansion respectively.

• A.    backward ….. conglomerate

• B.    backward ….. lateral

• C.    forward ….. conglomerate

• D.    forward ….. lateral