According to the PLC Theory, What Is the Most Likely

question 39

Multiple Choice

According to the PLC theory, what is the most likely reason that companies manufacture products in locations with high labor rates during the introductory stage of a product's life cycle?

• A)Doing so allows use of long production runs using capital-intensive methods.
• B)Many consumers are willing to pay high costs for the newest products.
• C)Transportation costs are reduced by focusing on markets in developed countries.
• D)Import restrictions prevent production in countries other than the ones making product innovations.

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Definitions:

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Firm Offer Rule

A legal principle stating that a merchant’s offer to buy or sell goods, assuring that the offer will remain open for a certain period, is binding and cannot be revoked.

Merchant Offeror

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