Final answer:
True. Marketers of domestically manufactured finished products may need to switch to offshore sourcing of certain components to stay competitive.
Step-by-step explanation:
True. Marketers of domestically manufactured finished products may be forced to switch to offshore sourcing of certain components to keep costs and prices competitive.
When imports can be sold at extremely low prices, domestic firms would have to match those prices to be competitive. However, matching prices would mean selling under cost and losing money. In order to avoid unsustainable losses, some marketers may decide to switch to offshore sourcing for certain components that can be obtained at lower costs from other countries.
For example, if a domestic firm is manufacturing smartphones and the cost of a specific component, like the screen, is significantly lower when sourced from an offshore supplier, the firm may choose to switch to offshore sourcing for that component in order to maintain competitive pricing.