What Does Outsourcing Allow Firms to Do

question 59

Multiple Choice

What does outsourcing allow firms to do?

• A) It allows them to shed functions the firm doesn't perform well in order to focus on its strengths.
• B) It allows them to gain more control over the firm's supply chain.
• C) It allows them to practise vertical integration.
• D) It allows them to set up shop in any country in the world.

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Definitions:

Net Earnings

The profit (or loss) of a business after all expenses have been deducted from revenues.

Probability

A measure of the likelihood that an event will occur, often expressed as a number between 0 and 1.

Net Earnings Per Share

A financial ratio calculated by dividing the net income of a company by the average number of its outstanding shares, indicating the company's profitability per share.

Stock Price

The cost of purchasing a single share of a company's stock, reflecting the value investors place on the company.