
Vertical integration most directly helps a firm reduce which type of business risk?
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Get StartedVertical integration most directly helps a firm reduce which type of business risk?
Options:
- Interest-rate risk
- Supply-chain and transaction risk
- Foreign-exchange risk
- Market demand risk
Correct answer: Supply-chain and transaction risk
Explanation: Vertical integration (forward or backward) reduces supply-chain and transaction risk by bringing suppliers or distributors in-house, stabilizing input access and lowering dependency on external partners.
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