Customers would face only one markup and the market would have one less deadweight loss. Therefore the price in which consumers would face would be lower, less cost to society as the burden of only one deadweight loss could be passed on to the consumer instead of the initial two. The lowered price of the goods or services for buyers will increase its demand and allow the firm to gain more profits. The firms profits could also be increased if the firm in the primary or secondary production part of the supply chain are able to cause an appreciation of the good before it is sold at tertiary level it will also increase demand and in turn the companies profits. So in this case both firms and consumers are benefiting from vertical
Customers would face only one markup and the market would have one less deadweight loss. Therefore the price in which consumers would face would be lower, less cost to society as the burden of only one deadweight loss could be passed on to the consumer instead of the initial two. The lowered price of the goods or services for buyers will increase its demand and allow the firm to gain more profits. The firms profits could also be increased if the firm in the primary or secondary production part of the supply chain are able to cause an appreciation of the good before it is sold at tertiary level it will also increase demand and in turn the companies profits. So in this case both firms and consumers are benefiting from vertical