In most circumstances, all fixed costs can be eliminated by outsourcing a product.

Question

Quizplus · Accepted Answer

Fixed costs are those costs that do not vary with the level of production or sales, such as rent, salaries, insurance, etc. While outsourcing a product may reduce certain fixed costs, it is unlikely that all fixed costs can be eliminated as the company must still maintain certain core operations and infrastructure in order to outsource the product effectively.

In Most Circumstances, All Fixed Costs Can Be Eliminated by Outsourcing