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Chapter 13: Problem 15

In the 1950 s and 1960 s the predominant form of merger was the merger. a) horizontal c) conglomerate b) vertical d) diversifying

Short Answer

Expert verified
The predominant form of merger in the 1950s and 1960s was the conglomerate merger.

Step by step solution

01

Understanding Different Types of Mergers

Horizontal mergers take place between companies in the same industry. Usually, these are competitor companies that merge to expand their market share, achieve economies of scale, or increase their product offering. Vertical mergers, however, involve companies in the same production process but at different stages. This results in a more consolidated monolithic structure. Conglomerate mergers include companies from completely different industries. Lastly, a diversifying merger is similar to a conglomerate merger but instead, it is carried out to diverse the operations of the company for mitigating risks related to one industry.
02

Historical Background

During the 1950s and 1960s, economic landscapes were evolving with rapid industrialization and globalization. Companies were looking to expand their operations by entering new markets or expanding their production. This was the time when conglomerates were popular as companies from different industries started to merge to mitigate risk, share resources, and benefit from shared knowledge.
03

Identifying the Predominant Form of Merger

Given historical trends and understanding of the business environment during the 1950s and 1960s, it can be inferred that the predominant form of merger during that period was likely to be the conglomerate merger.
04

Final Answer

Therefore, the correct answer is: c) Conglomerate.

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