- CFA Exams
- CFA Level I Exam
- Study Session 8. Corporate Finance (2)
- Reading 23. Mergers and Acquisitions
- Subject 2. Motives for merger
CFA Practice Question
Select the correct statement(s):
II. Vertical mergers may result in increase market power.
I. Horizontal mergers may result in increased market power.
II. Vertical mergers may result in increase market power.
Correct Answer: I and II
A horizontal merger may result in harm to consumers through higher prices, fewer choices. Vertical mergers may be able to influence its raw materials' industry output and prices.
User Contributed Comments 1
User | Comment |
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dragon2010 | nice question..initially i thought ans would be only horizontal merger |