Contract Manufacturing Is a Low-Cost Way for Banana Republic to Outsource

question 79

True/False

Contract manufacturing is a low-cost way for Banana Republic to outsource the production of its clothing designs.

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Definitions:

Nonlabor Resources

Nonlabor resources refer to the materials, capital, land, and technology used in the production of goods and services, distinct from human labor.

Output

The total amount of goods or services produced by a business, industry, or economy during a given period.

Average Total Costs

The total cost of production (fixed plus variable costs) divided by the total quantity of output, indicating the cost per unit of output.

Variable Costs

Costs that change in proportion to the level of output or activity.