When a company hires regular service from external sources which was previously provided internally is known as ______.
Outsourcing
This question describes a firm obtaining a regular service from an outside provider that it had earlier handled internally, and asks for the term for this practice.
This practice is called outsourcing, in which a company contracts out non-core activities such as payroll, customer support, IT services or manufacturing to specialised external agencies.
The main aims of outsourcing are to reduce costs, access external expertise and technology, and free the firm to concentrate on its core competencies.
Outsourcing became a defining feature of globalisation, with services like business process outsourcing (BPO) being shifted to countries offering skilled, lower-cost labour, including India.
Subsidization and cross-subsidization relate to price support, where one product, group or region is charged more to keep prices lower for another, and have nothing to do with sourcing services.
Globalisation is the broader process of integrating economies through trade, capital and technology flows, not the specific act of hiring an external service provider.
Hence the correct answer is Outsourcing.
Similar Questions
"This sector of economic activities involves processing of raw materials derived from primary sector into products for sale or consumption."
Which sector of the economy is being talked about in the information given above?
In the context of Microeconomics, the graphical representation of the demand function is called the _______.
Which of the following statement is correct regarding Public Goods?
Important Questions from Microeconomics
Which of the following statement is correct?
I. Indifference curves are sloping from left to right.
II. Higher indifference curve gives a higher level of utility.
If in a production process, all inputs are tripled, which of the following statements follows?
I. If the output is tripled, then decreasing returns to scale apply.
II. When the output is doubled, constant returns to scale apply.
III. If the output is more than tripled, then increasing returns to scale apply.
A market, in which there are a large number of firms, homogeneous product, infinite elasticity of demand for an individual firm and no control over price by firms, is termed as________.
If the two goods are substituted, then the indifference curve will be:
The government multiplier is given by (where c = MPC and t = tax rate)
