Exam 7: Vertical Integration and Outsourcing

When one firm tries to take advantage of another firm that has made a transaction-specific investment, by causing a brief delay in business because a product has no other use is known as a(n)___.

In the context of the primary reasons for vertical integration in companies, which of the following statements is true of coordination?

Which of the following is a primary characteristic of a transaction-specific asset?

Which of the following best illustrates reciprocal interdependence?

Activities closer to the beginning of the industry value chain are referred to as _________.

In the context of vertical integration, when is flexibility most valuable?

A car has to go through several different levels of manufacturing processes before it can be painted. The painting process cannot be initiated until a car is externally assembled and then inspected. This type of interdependence can be best termed as _________.

What are some of the advantages of outsourcing?

DHC Inc. is a television manufacturing company. The components of the televisions are manufactured separately by different companies around the globe. Later, these components are tested and then assembled to get the finished products in house by DHC Inc. In the context of the degree of coordination, this scenario best illustrates _________.

Adia, the chief executive officer (CEO)of Touch Works Corp., believes that outsourcing would be a disadvantage to her company. She states that she would not be able to control the finances and assets of her company if work gets outsourced. Which of the following statements strengthens Adia's belief?

Identify a reason why companies choose to make versus buy.

In the context of the three Cs of vertical integration, some activities require lower levels of coordination than others to be successful because the activities _________.

Which of the following statements is true of subcontractors?

What are the disadvantages to outsourcing?

Cygnus Bank is a banking and financial services company. It offered a large sum of money and a chance to receive employment to the programmers who could create software that would help enhance employee productivity. Which of the following types of crowdsourcing did Cygnus Bank use?

Identify a true statement about activities that are sequentially interdependent.

Yellow Express LLC is a company in the computer hardware industry that solely manufactures microchips. Yellow Express LLC is _________.

Outsourcing is advantageous when _________.

Identify a danger of vertical integration.

What is the main difference between a company that is vertically integrated and a company that is vertically specialized?