Asked by Taylor Ingram on Jul 29, 2024
Verified
When companies move production outside of the home country it results in:
A) Jobs lost in the home country
B) Cheaper labor costs
C) Workers being retrained and therefore the unemployment rate does not increase
D) A & B only
E) B & C only
Home Country
The country where a company is headquartered or where an individual is a citizen.
Labor Costs
The total sum of all wages paid to employees, as well as the costs of employee benefits and payroll taxes incurred by an employer.
Unemployment Rate
The percentage of the labor force that is jobless and actively seeking employment.
- Assess the influence of trade theories on the formulation of international trade policies.
- Comprehend the principles and consequences of foreign exchange and its impact on global business activities.
Verified Answer
MM
Mathis MazurekJul 30, 2024
Final Answer :
D
Explanation :
When companies move production outside of the home country, it results in jobs lost in the home country due to the closing of domestic factories and businesses. However, it also often results in cheaper labor costs for the company in the foreign country, making it a financially advantageous decision for the company.
Learning Objectives
- Assess the influence of trade theories on the formulation of international trade policies.
- Comprehend the principles and consequences of foreign exchange and its impact on global business activities.