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Ronen Argo,the Head of Manufacturing of Rinker Audio Products Wants

Question 49

Multiple Choice

Ronen Argo,the head of manufacturing of Rinker Audio Products wants the company to centralize its manufacturing in one location in a single country.In contrast,Neha Patel,the company's CFO wants the company to operate several manufacturing facilities in various countries.Which of the following statements is true about performing a manufacturing activity in several locations at once?


A) A manufacturing activity must be performed at multiple locations when the fixed costs of setting up a production plant are high.
B) Performing a manufacturing activity in several locations makes it difficult for a firm to accommodate demands for local responsiveness.
C) Producing in multiple locations reduces the bargaining power of a firm against manufacturers.
D) The larger the minimum efficient scale of a plant relative to total global demand,the greater the need for decentralizing production to multiple locations.
E) Many firms disperse their manufacturing plants to different locations as a "real hedge" against potentially adverse moves in currencies.

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