What signifies joining with a business in the previous stage of production?

The correct answer is backward vertical integration, as it refers to a company expanding its operations into earlier stages of production within its supply chain. By joining with a business that provides inputs or raw materials, a company can gain more control over its supply chain, reduce dependence on suppliers, and potentially lower costs. This strategy allows the business to secure access to essential resources, improve quality, and stabilize production processes.

In contrast, forward vertical integration would involve moving downstream in the supply chain by acquiring businesses that handle distribution or retail, while horizontal integration would entail merging with or acquiring competitors at the same stage of production. A merger, while also involving the joining of businesses, does not specify the direction of integration within the supply chain and could apply to any level or type of business combination.