Question

Components of the value chain:

a) Stand alone and do not need to communicate with each other.
b) Include any process or task that adds value to the end product.
c) Are overhead and not included in the costing of the end product.
d) All of the above

Answer 1

The components of the value chain include any process or task that adds value to the end product, and as global trade has evolved, these tasks are often located in different companies and countries to leverage specialization.

Step-by-step explanation:

The components of the value chain include any process or task that adds value to the end product. This involves activities like design, production, marketing, and distribution, which are increasingly split across different firms and countries due to advancements in communication, information sharing, and transportation.

In the context of global trade, this splitting up of the value chain allows for specialization and can lead to economic gains as firms and workers focus on specific parts of the production process. This trend has led to international trade that often involves shipping specialized parts or goods rather than complete finished products. This process coexists with the concept of comparative advantage, expanding and enriching it.

Therefore, the correct answer to the question about components of the value chain is b) Include any process or task that adds value to the end product.