Lenovo's ThinkPad Laptop Computers Are Designed in the United States;

question 54

Multiple Choice

Lenovo's ThinkPad laptop computers are designed in the United States; the case, keyboard, and hard drive are made in Thailand; the display screen and memory in South Korea; the built-in wireless card in Malaysia; and the microprocessor in the United States. In each case, these components are manufactured and sourced from the optimal location given current factor costs. In this example, Lenovo has

• A) vertical integration advantages.
• B) a global web of value creation activities.
• C) learning effects.
• D) high local responsiveness.

---

Definitions:

Systematic Risk

The risk of a collapse in an entire financial system or entire market, due to factors such as economic crises, which cannot be avoided through diversification.

Expected Return

The anticipated average return of an investment over a specific period, considering various probable outcomes.

Realized Return

The actual gain or loss experienced on an investment, calculated by taking the difference between the selling price and the purchase price.

Term Life

Term life is a type of life insurance policy that provides coverage at a fixed rate of payments for a limited period, known as the relevant term.