To Use Location to Build Competitive Advantage, a Company That

question 86

Multiple Choice

To use location to build competitive advantage, a company that operates transnationally or globally must

• A)employ either an export strategy or a franchising strategy.
• B)scatter its production plants across many countries in different parts of the world so as to minimize transportation costs.
• C)consider whether to concentrate each activity it performs in a few select countries or disperse performance of the activity to many nations and consider in which countries to locate particular activities.
• D)locate production plants in those countries having suppliers that can supply all the necessary raw materials and components so as to avoid inbound shipping costs.
• E)concentrate all of its value chain activities in the one country that has the best combination of low wage rates, low shipping costs, and low tax rates on profits.

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Definitions:

Trade

The act of transacting by acquiring, disposing of, or swapping commodities and services within or between nations.

Opportunity Cost

The financial sacrifice of skipping the subsequent best choice when a decision is made.

Coconuts

Coconuts are the large seeds of the coconut palm tree, known for their edible flesh, water, and oil, which are used in a variety of culinary, cosmetic, and industrial products.

Fish

Aquatic, vertebrate animals with gills and fins, living in water bodies around the world, used for food, sports, or as pets.