High tariffs lead to more production locations within a supply chain network, with each location having a lower allocated capacity. True or False?
Understand the Problem
The question is asking whether high tariffs lead to an increase in the number of production locations within a supply chain, while also suggesting that each of these locations has a lower capacity. Essentially, it's testing knowledge about the economic implications of tariffs.
Answer
TRUE
The final answer is TRUE.
Answer for screen readers
The final answer is TRUE.
More Information
High tariffs can lead companies to establish more production locations within a supply chain network to minimize tariff impacts, resulting in each location operating at a lower capacity.
Tips
A common mistake is failing to consider how tariffs might encourage companies to produce more locally to avoid higher costs.
Sources
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