When a Company Accepts an Outsourcing Offer, Managers Must Take

question 165

Multiple Choice

When a company accepts an outsourcing offer, managers must take specific action to eliminate internal costs.Which of the following is not a quantitative or qualitative factor managers should consider when accepting an outsourcing offer?

• A)How to reduce direct labor
• B)How to eliminate shipping charges
• C)Impact on employee morale
• D)Whether to replace production managers

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Definitions:

Purely Competitive Industry

An industry characterized by many sellers offering identical products, where no single seller can influence the market price.

Long-run Equilibrium

A state in which all inputs and outputs in an economy are optimally allocated, and all firms make zero economic profit, reflecting no incentives for market entry or exit.

Consumer Demand

The desire of consumers to purchase goods and services at given prices, which can vary with changes in income, preferences, and prices of related goods.

Purely Competitive Firm

A company operating in a market where there are many buyers and sellers, the product is homogeneous, and there are no barriers to entry or exit.