A firm that builds dedicated facilities to produce a relatively stable output of products over time in a very efficient manner and purchases peak production capability from other companies is using subcontracting.

Question

Quizplus · Accepted Answer

The firm is actually using the strategy of outsourcing, not subcontracting. Subcontracting refers to a situation where a company outsources a specific task or component to a specialized subcontractor, while outsourcing involves hiring an external company to handle a broader range of services or processes.

A Firm That Builds Dedicated Facilities to Produce a Relatively