Each of the following is a disadvantage of buying rather than making a component of a company's product except that Select one:

a. Quality control specifications may not be met

b. The outside supplier could increase prices significantly in the future

c. Profitable product lines may be dropped

d. The supplier may not deliver on time

Question

Jagger

Business

23 July, 08:13

Each of the following is a disadvantage of buying rather than making a component of a company's product except that Select one:

a. Quality control specifications may not be met

b. The outside supplier could increase prices significantly in the future

c. Profitable product lines may be dropped

d. The supplier may not deliver on time

+5

Answers (1)

Know the Answer?

Giles · Answer 1

The correct answer is letter "C": Profitable product lines may be dropped.

Explanation:

The decision of making a product in-house or relying on an outsourcing manufacturer is evaluated mainly by comparing the costs that handling a new production line carries. While outsourcing can save a company a great amount of money in labor, equipment, materials, and knowledge, quality control is not managed directly.

However, a new line of components in-house implies incurring in most costs that could conflict the production of existing profitable product lines that could see their numbers reduce gradually until the product drops.