Multinationals generally have production plants in a number of countries. Consequently, they can move production from expensive
Multinationals generally have production plants in a number of countries. Consequently, they can move production from expensive locations to cheaper ones in response to various economic developments—a phenomenon called outsourcing when a domestically based firm moves part of its production abroad. If the dollar depreciates, what would you expect to happen to outsourcing by American companies? Explain and provide an example.
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If the dollar depreciated all else being equal we would expect outsourcing to diminish If as the pro...View the full answer
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