Advanced Competitive Strategy | Online Course Support

Which statements about the make-or-buy decision are true?

 
 
 

This is correct. Production risks can be shared with the supplier because the firm can for example purchase more input goods when demand is high and purchase less if the market is in a recession.

 
 
 

This is true. If your input supplier serves a large market and faces economies of scale then this firm can offer a lower price. This lower price can be an advantage of purchasing the input good instead of producing it on your own.

 
 
 

This is true because the production of the input goods does not need to be controlled as much as when producing itself (only the delivered input good needs to be controlled but not the whole production process).

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