Which of the Following Is TRUE About Outsourcing

question 103

Multiple Choice

Which of the following is TRUE about outsourcing?

• A) Outsourcing allows firms to be more flexible and requires minimal coordination.
• B) Outsourcing allows firms to concentrate on those areas in which they can create value.
• C) Outsourcing strengthens the creative and innovative functions within the firm.
• D) Outsourcing is effective only when it includes all support activities.

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Definitions:

Sell

To sell involves the exchange of a product or service for money, constituting a basic economic transaction between a provider and a receiver.

Fixed Maintenance Cost

The portion of total maintenance costs that does not fluctuate with changes in activity level or output.

Machine-Hours

The total hours that a machine is operated over a specific period of time, used in allocating manufacturing costs.

Relevant Range

The scope of operations in which the beliefs regarding constant and fluctuating cost patterns hold true.