Which of the following best illustrates backward vertical integration?

A. A firm that manufactured and sold car engines to major automobile companies launches its own line of cars.
B. A chain of restaurants opening a food processing plant to supply its own ingredients.
C. A software company acquiring a social media platform.
D. A clothing retailer starting to manufacture fabrics.

The answer that best illustrates backward vertical integration is b) A chain of restaurants opening a food processing plant to supply its own ingredients. This option demonstrates a company integrating into its supply chain by seeking control or ownership over its suppliers.

Explanation:

Vertical integration is a strategy where a firm expands its operations into different stages along its value chain. In the context of backward vertical integration, a company moves upstream in its supply chain to control the production of the raw materials or components required for its primary products or services. The chain of restaurants creating a food processing plant exemplifies this strategy, as the restaurant is assuming control over its ingredient supply, rather than acquiring a customer-facing platform or fabricating its own line of cars, which are not backward movements in the supply chain.