Overall company profits will not be enhanced if a buying division acquires products from outside suppliers at an annual cost that is less than the incremental cost to the supplying division within the company.

Question

Quizplus · Accepted Answer

If the buying division acquires products from outside suppliers at an annual cost that is less than the incremental cost to the supplying division within the company, it can still result in an overall company profit if the savings from the external supplier are greater than the loss in revenue for the supplying division. Therefore, this statement is false.

Overall Company Profits Will Not Be Enhanced If a Buying