2.1.1 - Inorganic Business Growth

What is inorganic growth?

• Growth achieved through mergers and takeovers

• Growth achieved through reducing employee numbers

• Growth achieved through a company's own efforts

• Growth achieved through increasing product prices

What is a merger?

• When a company reduces its workforce

• When a company expands its product line

• When two or more companies come together to form a new company

• When one business purchases another

Which of the following is an example of a merger?

• Facebook buying Instagram

• Amazon buying Whole Foods

• Kraft and Heinz forming Kraft Heinz

• Google buying YouTube

What is a takeover?

• When two companies merge to form a new entity

• When a business purchases and owns another business

• When a company expands its market share

• When a company reduces its production costs

Which of the following is an example of backward vertical integration?

• Amazon buying Whole Foods

• Michelin taking over a rubber producer

• Facebook buying Instagram

• Kraft and Heinz forming Kraft Heinz

What is forward vertical integration?

• When a business takes control of another business earlier in the supply chain

• When a company reduces its production costs

• When a business takes control of another business at a later stage in the supply chain

• When two companies merge to form a new entity

Which of the following is an example of horizontal integration?

• Amazon buying Whole Foods

• Michelin taking over a rubber producer

• Facebook buying Instagram

• Kraft and Heinz forming Kraft Heinz

What is one advantage of mergers and takeovers?

• Decreased market competition

• Reduced regulatory scrutiny

• Increased employee satisfaction

• Immediate increase in revenue

What is one disadvantage of mergers and takeovers?

• Regulatory blocks

• Reduced production costs

• Immediate increase in revenue

• Increased market share

What is a potential issue when integrating two different corporate cultures?

• Reduced production costs

• Difficulty in navigating different management systems

• Immediate increase in revenue

• Increased market share