High tariffs lead to more production locations within a supply chain network,with each location having a lower allocated capacity.

Question

Quizplus · Accepted Answer

High tariffs increase the cost of importing goods, which may lead companies to establish more production locations within their supply chain network to avoid or reduce the tariffs. However, to minimize costs, each location may have a lower allocated capacity, meaning that less output is produced at each location compared to a network with fewer production locations.

High Tariffs Lead to More Production Locations Within a Supply