Dispersing the performance of value chain activities to many different countries rather than concentrating them in a few country locations tends to be advantageous
A) when high transportation costs make it expensive to operate from central locations.
B) whenever buyer-related activities are best performed in locations close to buyers.
C) if diseconomies of large size exist,thereby making it more economical to perform an activity on a smaller scale in several different locations.
D) when it is desirable to hedge against (1)the risks of fluctuating exchange rates (such risks are greater when activities are concentrated in a single location)or (2)supply interruptions (due to strikes,mechanical failures,or transportation delays)or (3)adverse political developments.
E) All of these.

Question

Quizplus · Accepted Answer

All of the aforementioned factors can be advantages for dispersing the performance of value chain activities to multiple locations, including high transportation costs, buyer proximity, diseconomies of large size, and risk mitigation measures such as exchange rate fluctuations, supply interruptions, and political instability.

Dispersing the Performance of Value Chain Activities to Many Different