Dispersing the Performance of Value Chain Activities to Many Different

question 17

Multiple Choice

Dispersing the performance of value chain activities to many different countries rather than concentrating them in a few country locations tends to be advantageous

• A) when high transportation costs make it expensive to operate from central locations.
• B) whenever buyer-related activities are best performed in locations close to buyers.
• C) if diseconomies of large size exist,thereby making it more economical to perform an activity on a smaller scale in several different locations.
• D) when it is desirable to hedge against (1)the risks of fluctuating exchange rates (such risks are greater when activities are concentrated in a single location)or (2)supply interruptions (due to strikes,mechanical failures,or transportation delays)or (3)adverse political developments.
• E) All of these.

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Definitions:

Performance Criteria

The standards or benchmarks used to assess the quality or success of a task, project, or performance.

Human Capital

The collective skills, knowledge, and expertise that employees contribute to an organization's value.

Productivity

A measure of the efficiency of a person, machine, factory, system, etc., in converting inputs into useful outputs.

Extrinsic Benefits

Advantages or rewards received from an activity that are external to the activity itself, such as money, grades, or recognition.