Question

Contracting with a third party or an external company to manufacture a good or deliver a service is known as ______.

1) offshoring
2) outsourcing
3) internalization
4) domestic production

Answer 1

Contracting with a third party to manufacture goods or deliver services is called outsourcing, which is a common business practice for managing tasks outside of a company's core services.

Step-by-step explanation:

Contracting with a third party or an external company to manufacture a good or deliver a service is known as outsourcing. This business practice entails hiring another company to perform tasks, handle operations, or provide services that are either difficult for the company to manage or outside of the company's core competencies. While outsourcing often involves shifting jobs to an outside source, sometimes in another country, offshoring refers to moving some of a company's own operations to a foreign country to take advantage of lower labor costs.