When a company performs a value creation activity in a region that is optimal for that activity, wherever in the world that might be, it is trying to capitalize on:
A) negative feedback loops.
B) economies of scope.
C) the transnational strategy.
D) location economies.
E) its localization strategy.

Question

Quizplus · Accepted Answer

Location economies refer to the cost advantages that arise from performing a value creation activity in the optimal geographic location for that activity. This could be due to factors like lower labor costs, access to key supplies or resources, favorable regulations, or proximity to key customers or markets. By capitalizing on location economies, companies can improve their competitiveness and profitability.

When a Company Performs a Value Creation Activity in a Region