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:

Average Product

The output per unit of a particular input, calculated by dividing total product by the quantity of that input.

Marginal Product

The increase in output that arises from an additional unit of input.

Customers Served

The number or segment of clients to whom a business has provided goods or services.

Marginal Products

The additional output that results from using one more unit of a particular input, holding all other inputs constant.