When a person buys out their competition, the are practicing ... a Horizontal integration b Vertical integration

When a company buys out their competition, then they are practicing vertical integration. Vertical integration can be explained as a process when a company take over or buys out its competitive company which operates in the in the production process of the same business.

Some of the reasons due to which a company goes under the process of vertical integration to gaining strength in supply chain, gaining profits, making new distributions channels, decreasing production cost and etc. An example of vertical integration of 2011's Google acquisition over Smartphone company Motorola.