Why Are a Large Number of IT Jobs Being Outsourced

question 112

Multiple Choice

Why are a large number of IT jobs being outsourced to China and India?

• A)India and China experience large balance of payment deficits.
• B)India and China are highly capital intensive economies.
• C)India and China have abundant supply of cheap skilled labor.
• D)India and China have abundant supply of unskilled labor.
• E)India and China are rich in natural resources.

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Definitions:

Fixed Costs

Fixed costs are business expenses that remain constant regardless of the level of production or sales, such as rent, salaries, and insurance.

Average Variable Cost

The total variable cost per unit of output, obtained by dividing total variable costs by the quantity of output.

Output

The total amount of goods or services produced by a company or country.

TVC

Total Variable Cost, the sum of all variable costs (costs that vary with production volume) associated with producing a specific quantity of a good or service.