Gibson Enterprises Is an MNE That Relies on Just-In-Time Inventory

question 64

Multiple Choice

Gibson Enterprises is an MNE that relies on just-in-time inventory management and lean manufacturing systems to optimize quality and efficiency.For the last few years, Gibson has used the same foreign sources for its raw materials.What is the most likely risk faced by Gibson because of foreign sourcing?

• A)quality of incoming inventory
• B)uncertainty of arriving parts
• C)few available suppliers
• D)high inventory costs

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Definitions:

Opportunity Cost

Opportunity cost is the value of the best alternative foregone when a decision is made to pursue a particular action or resource allocation.

Machinery

Machines or machine systems collectively, which are used in a variety of industries to produce or facilitate the production of goods.

Sweaters

Garments intended to cover the upper body and arms, typically knitted from wool, cotton, or synthetic fibers.

Production Possibility Frontiers

A portrayal conveying the absolute production potential for two commodities, hinging on distinct inputs such as resources and supplementary factors.