The Costs That Should Be Included in an Outsourcing Decision

question 144

Multiple Choice

The costs that should be included in an outsourcing decision are the

• A)sunk costs.
• B)recurring costs.
• C)relevant costs.
• D)fixed costs.

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Definitions:

Entrepreneurship

The activity of setting up a business, taking on financial risks in the hope of profit.

Implicit Costs

The opportunity costs of resources already owned by the firm and used in business, for which no cash payment is made.

Price-Discriminating

A pricing strategy where a seller charges different prices for the same product or service to different customers, based on factors like buyer's age, location, or purchase history.

Elastic Demand

A situation in which the demand for a product is highly responsive to changes in its price.