In considering the decision to offshore, which of the following generally is not one of the hidden costs?
A)Total wage costs and indirect costs
B)Wage deflation
C)Reduction in intellectual property rights
D)Increased inventory and coordination costs

Question

Quizplus · Accepted Answer

Common savings from offshoring, such as lower wages, benefits, energy costs, regulatory costs, and taxes, are all easily visible and immediate. In contrast, there are a host of hidden costs that arise over time and often overwhelm the cost savings of offshoring. These hidden costs include: total wage costs, indirect costs, increased inventory, reduced market responsiveness, coordination costs, intellectual property rights, and wage inflation.

In Considering the Decision to Offshore, Which of the Following