Asked by Brianna Sparks on Apr 25, 2024
Verified
High tariffs lead to more production locations within a supply chain network,with each location having a lower allocated capacity.
Tariffs
Taxes imposed by a government on imported or exported goods to regulate trade, increase revenue, or protect domestic industries.
Production Locations
The specific sites or facilities where goods are manufactured or assembled.
- Recognize the role of tariffs in decisions about production location and capacity allocation.
Verified Answer
BH
Baqer Hamid1 week ago
Final Answer :
True
Explanation :
High tariffs increase the cost of importing goods, which may lead companies to establish more production locations within their supply chain network to avoid or reduce the tariffs. However, to minimize costs, each location may have a lower allocated capacity, meaning that less output is produced at each location compared to a network with fewer production locations.
Learning Objectives
- Recognize the role of tariffs in decisions about production location and capacity allocation.