The Practice of Using Outside Vendors to Provide Goods and Services

question 145

Multiple Choice

The practice of using outside vendors to provide goods and services that were formerly produced in-house is known as _____.

• A)outsourcing
• B)sole sourcing
• C)supply chain inversion
• D)leasing

---

Definitions:

Declining Quality

The phenomenon where the standard or grade of a product, service, or overall condition deteriorates over time, potentially affecting customer satisfaction and market position.

Deductible Amount

The portion of a claim that a policyholder must pay out of pocket before the insurance covers the remaining costs.

Adverse Selection

A situation where asymmetric information leads to the selection of undesirable participants in a transaction or contract, often seen in insurance markets.