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Question
Which of the following statements is true about performing a manufacturing activity in several locations at once?
A. A manufacturing activity must be performed at multiple locations when the fixed costs of setting up a production plant are high.
B. Performing a manufacturing activity in several locations makes it difficult for a firm to accommodate demands for local responsiveness.
C. Producing in multiple locations reduces the bargaining power of a firm against manufacturers.
D. The larger the minimum efficient scale of a plant relative to total global demand, the greater the need for decentralizing production to multiple locations.
E. Many firms disperse their manufacturing plants to different locations as a real hedge against potentially adverse moves in currencies.
Answer
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