Final answer:
The activities encompassing the design to post-sales services of products and services for customers constitute the value chain. It showcases the split of production stages across different firms or countries, leading to efficient production and innovation. This trend in international trade allows for economic gains through specialization and intra-industry trade.
Step-by-step explanation:
The set of activities required to design, develop, produce, market, deliver, and provide post-sales service for the products and services sold to customers is known as the value chain. The concept of a value chain is integral to understanding how a good or service is produced through various stages, a process that can be split into different tasks managed by specialized firms or divisions within a company. The iPhone, for example, is designed and engineered in the United States, with parts supplied from Korea and assembled in China, before being marketed and sold globally. This splitting up of the value chain is part of a growing trend in international trade, enabled by advances in communication, information sharing, and transportation.
The value chain allows firms to focus on specific aspects of production, often at different geographic locations, which can lead to more efficient production and innovation while dispersing economic activity across different regions and countries. This specialization and division of labor among firms and countries can lead to economic gains, as it allows for an increase in intra-industry trade, with countries exporting and importing comparable but differentiated products.