Question

______ occurs when an organization transfers manufacturing, services, and other functions to countries where labor and supplies are less expensive?

1) Outsourcing
2) Offshoring
3) Insourcing
4) Downsizing

Answer 1

Offshoring occurs when an organization transfers business functions to countries with less expensive labor and supplies, which is answer 2 to the question asked.

Step-by-step explanation:

The process offshoring refers to when an organization moves its manufacturing, services, or other business functions to countries where labor and supplies are less expensive. This is distinguished from outsourcing, which is when a company hires an outside firm, possibly abroad, to perform tasks it previously carried out internally. Offshoring can be part of a strategy to reduce costs and increase competitiveness, particularly in an era of globalization where trade agreements, such as NAFTA, enable companies to easily move operations across borders.

In the context of the question, the correct answer is: 2) Offshoring. This practice has been adopted by businesses seeking to lower their operation costs and has resulted in significant economic shifts, affected employment levels in developed countries, and influenced the international political economy.