Outsourcing Occurs When a Firm

question 63

Multiple Choice

Outsourcing occurs when a firm:

• A) buys one of its rivals.
• B) merges with one of its suppliers.
• C) enters into a joint venture with a rival.
• D) hires another firm to perform value creation activities.
• E) enters into contracts with two suppliers simultaneously.

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Definitions:

Profit Center

A segment or branch of a company that is directly responsible for generating profit through its operations and is evaluated on its profitability.

Cost Center

A business unit that incurs costs but does not directly generate revenues, often evaluated for efficiency and cost control.

Cost Center

A division or unit within an organization that does not directly add to profit but still incurs costs, often analyzed for budgeting and cost control.

Profit Center

A branch or division of a company that is directly responsible for generating its own revenue and profits.