A decision involving a choice between internal and external production is what kind of decision?
A) relevant
B) keep-or-drop
C) sell-or-process-further
D) special-order
E) make-or-buy

Question

Quizplus · Accepted Answer

This is a make-or-buy decision, where the company has to choose between producing a product internally or outsourcing its production to an external vendor. The best choice depends on various factors such as cost, quality, expertise, capacity, and availability of resources. Generally, companies choose to make a product internally if they have the skills, resources, and capacity to do it efficiently and cost-effectively. On the other hand, outsourcing may be a better option if the company lacks the necessary capabilities, wants to focus on their core competencies, or finds it cheaper to buy from an external vendor. The decision ultimately depends on a thorough analysis of the costs and benefits of each option.

A Decision Involving a Choice Between Internal and External Production