Melrow Inc.,a U.S.firm,suffers heavy losses and lays off many of its employees.As a measure to reduce its manufacturing costs,it shifts its production units to another country where labor costs are less.In this scenario,Melrow Inc.is engaged in _____.

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Melrow Inc. is shifting its manufacturing units to another country where labor costs are less as a measure to reduce its manufacturing costs. This practice is known as outsourcing. Option A (licensing) refers to an agreement in which one company allows another company to use its intellectual property, such as patents or trademarks, for a fee. Option C (franchising) refers to a business model in which a company licenses its brand name and operating methods to a third party who operates a franchise of the company’s business. Option D (inshoring) refers to the practice of relocating business operations to the home country from overseas locations.