Final answer:
The decision to outsource manufacturing is highly important for a firm due to cost implications, job shifts, and production technology considerations. The correct option is a.
Step-by-step explanation:
When considering whether to outsource the manufacturing of products, it's indeed of high importance to a firm. The decision of outsourcing production jobs can lead to significant cost savings, as firms may find cheaper labor and production costs in developing nations.
However, this often comes with trade-offs such as the loss of local jobs, the potential for lower quality control, and the complexities of managing international relationships and logistics.
Outsourcing was initially a practice for manufacturing and related work but has also become prevalent in customer service and other sectors.
For a firm, selecting the right production technology is crucial, and they must often choose based on which offers the lowest total cost, balancing factors such as capital and labor inputs. Issues such as an increase in the cost of machines, lead companies to adjust their use of capital versus labor.
In essence, outsourcing can lead to the movement of factories and jobs to other countries, driven by multinational corporations seeking the lowest cost options.
This trend has notably impacted job availability in developed countries and has greatly caused shifts in demand for workers in the service and manufacturing sectors alike.
Therefore, the statement is true: In the decision about whether to outsource, manufacturing of products is considered of high importance to a firm. The correct option is a.