It Is Most Appropriate for a Firm to Contract Out

question 66

Multiple Choice

It is most appropriate for a firm to contract out manufacturing when

• A) individual manufacturers have few firm-specific skills that contribute to the value of their product.
• B) the value of the host country currency is expected to appreciate.
• C) supplier switching costs are correspondingly high.
• D) firm-specific technology and expertise add significant value to the product.
• E) the currency used for pricing a product is anticipated to stay weak in the long run.

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Outside Borders

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