If the production technology is very inflexible and product requirements vary from one country to another,a firm has to set up
A)local facilities to serve the market in each country.
B)a few high-capacity facilities to serve the market in each country.
C)many local facilities because this helps lower transportation costs.
D)a few high-capacity facilities because this helps lower transportation costs.

Question

Quizplus · Accepted Answer

With inflexible production technology and varying product requirements in different countries, setting up local facilities in each country is the best choice. This allows for customization of the product to meet local requirements, and reduces transportation costs and lead times. A few high-capacity facilities may not be effective as they may not be able to cater to the diverse needs of different markets, while setting up many local facilities may be too costly and inefficient.

If the Production Technology Is Very Inflexible and Product Requirements