1. Explain the concept of “economies of scale”. How does this differ from a similar sounding
term “economies of scope”? (Chapter 2)
2. What do you mean by the term “(horizontal) diversification”? What are some of the advantages and disadvantages of being a horizontally diversified firm? (Chapter 2)
3. If someone asks you what the term “vertical integration” means, how would you describe it?
Also, what would you consider as a key reason for why firms vertically integrate into different stages of the value chain? (Chapter 3)
4. Briefly describe the basic idea behind Porter’s five forces model. (Chapter 8)
5. Briefly describe Porter’s “generic strategies” (Chapter 9)
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