Dispersing Particular Value Chain Activities Across Many Countries Rather Than

question 41

Multiple Choice

Dispersing particular value chain activities across many countries rather than concentrating them in a select few countries can be more advantageous except when

• A) buyer-related activities (such as sales,advertising,after-sale service and technical assistance)need to take place close to buyers.
• B) buyers demand short delivery times and/or high transportation costs make it uneconomical to operate from one or just a few locations.
• C) it helps hedge against the risks of exchange rate fluctuations,supply disruptions,and adverse political developments.
• D) there are diseconomies of scale in trying to operate from a single location.
• E) there are reasons to decouple buyer-related activities in favor of locational advantages.

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Definitions:

Semiannual Interest

Semiannual Interest refers to interest that is calculated and paid twice a year, commonly found in bonds and other types of loans.

Fiscal Year

A one-year period that companies and governments use for financial reporting and budgeting, which may not coincide with the calendar year.

Accrued Interest

The interest that has been incurred but not yet paid on a loan or bond.

Fiscal Year

A 12-month period used for accounting and financial reporting purposes, which may or may not align with the calendar year.