Which type of company structure is characterized by combining firms at different production levels?

The type of company structure characterized by combining firms at different production levels is referred to as a vertical merger. This occurs when two companies that operate at different stages of the production process for a specific product or service come together. For example, a manufacturer may merge with a supplier to create a more integrated supply chain, thereby gaining greater control over its inputs and logistics. Such a merger can enhance efficiency, reduce costs, and provide a competitive advantage by ensuring a consistent supply of materials or by streamlining production.

In contrast, a joint venture involves two or more firms collaborating for a specific project or purpose while maintaining their individual identities. A horizontal merger occurs when firms in the same industry and at the same stage of production combine, which can lead to increased market share but does not integrate different stages of production. An acquisition generally refers to a company taking over another company, which may be either horizontal or vertical in nature, but the key feature of a vertical merger is the integration of different production levels within the same industry.