A Firm Should Decide to Buy Components from a Supplier

question 1

Multiple Choice

A firm should decide to buy components from a supplier (as opposed to making them)

• A) when it has excess plant capacity.
• B) when it will require greater flexibility on the firm's part to accommodate the supplier.
• C) if product quality would be the same (regardless of the firm's decision.)
• D) if the risk of equipment obsolescence can be transferred to the supplier.

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Definitions:

Consensus

A general agreement among the members of a group or community, often achieved through open discussion and negotiation.

Neutral Stimulus

A stimulus that initially produces no specific response other than focusing attention, until it is associated with an unconditioned stimulus.

Conditioned Stimulus

A stimulus that was neutral at first but becomes associated with an involuntary response through conditioning.

Reinforcement Theory

A theory that states that behavior is a function of its consequences and is determined exclusively by environmental factors such as external stimuli and other reinforcers.