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Suppose there are two firms, Firm A and Firm B, that both produce airplanes. The parts for the planes made by Firm A are commonly
Suppose there are two firms, Firm A and Firm B, that both produce airplanes. The parts for the planes made by Firm A are commonly used by other aerospace companies, while Firm B's parts are unique to their airplanes. Which firm is more likely to be vertically integrated and why? Question 8 options: a) Firm B, because they have greater asset specificity b) Firm B, because they likely operate in a smaller market c) Firm A, because their production process is likely cheaper d) Firm A, because it is easier to find experts to work in the firm
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