1) Background: A central issue in business strategy is how to organize the vertical chain. Firms must decide if it is better to organize all of the activities in a single firm or is it better to relay on independent firms in the market. Example of a successfully vertically integrated firm is Scott Paper. Other firms are vertically disintegrated where they outsource most of tasks in the vertical chain to independent contractors i.e. Nike, Benneton, Chrysler.

Question: What factors might account for these different business strategies in organizing the vertical chain? Must be specific about the factors.

2) Write a specific evaluation of the following:
"We purchased the supplier so that we could keep the profit instead of paying it to some other firm".