A Firm That Engages in Strategic Outsourcing Typically

question 82

Multiple Choice

A firm that engages in strategic outsourcing typically

• A) increases its internal transaction costs.
• B) reduces its level of vertical integration.
• C) reduces its level of external transaction costs.
• D) increases its level of horizontal integration.

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Definitions:

Global Marketplace

An interconnected environment where goods, services, and labor are exchanged across national borders, fueled by globalization.

Direct Investment

An investment in the form of a controlling ownership in a business in one country by an entity based in another country.

Exporting

The business practice of selling goods or services produced in one country to buyers in another country.

Indirect Export

The process of selling goods or services to a foreign market through intermediaries, rather than directly to the end purchaser.