When a firm decides to move away from ownership of a vertically integrated production process and begins to purchase supplies or other services from other businesses,it is said to be:
A)integrating downstream.
B)integrating upstream.
C)franchising.
D)outsourcing.

Question

Quizplus · Accepted Answer

When a firm decides to purchase supplies or services from other businesses instead of owning the production process, it is known as outsourcing. This allows the firm to focus on its core competencies while reducing costs associated with owning and maintaining the production process.

When a Firm Decides to Move Away from Ownership of a Vertically