By buying from multiple suppliers located in several countries, a company can maintain the flexibility needed to change sources and reduce the risk associated with sudden swings in exchange rates.

Question

Quizplus · Accepted Answer

By diversifying the sources of supply across multiple countries, a company can reduce the dependency on a single supplier and maintain the flexibility to switch to alternative options. Moreover, buying from suppliers in different countries can help to mitigate the impact of sudden fluctuations in exchange rates since the risks associated with one currency can be offset by gains from another currency.

By Buying from Multiple Suppliers Located in Several Countries, a Company