Dispersing the Performance of Value Chain Activities to Many Different

question 97

Multiple Choice

Dispersing the performance of value chain activities to many different countries rather than concentrating them in a few country locations tends to be advantageous

• A) when high transportation costs make it expensive to operate from central locations.
• B) whenever buyer-related activities are best performed in locations close to buyers.
• C) if diseconomies of large size exist,thereby making it more economical to perform an activity on a smaller scale in several different locations.
• D) when it is desirable to hedge against (1)the risks of fluctuating exchange rates,(2)supply interruptions or (3)adverse political developments.
• E) All of these.

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Definitions:

Actual Price Level

The current general price of goods and services in the economy.

Expected Price Level

This refers to the anticipation or forecast of future prices of goods and services in the economy, often influencing consumer and business decisions.

Foreign-Currency Exchange

The process of exchanging one currency for another, which involves determining the rate at which two currencies will be swapped.

Aggregate Demand

The total demand for all goods and services within a particular market or economy at various price levels, during a specified time period.