Whether to make a component part in-house or to contract it out to an independent supplier
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Whether to make a component part in-house or to contract it out to an independent supplier
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Answer the following question:
- A firm must decide whether to make a component part in-house or to contract it out to an independent supplier. Manufacturing the part requires a nonrecoverable investment in specialized assets. The most efficient suppliers are located in countries with currencies that many foreign exchange analysts expect to appreciate substantially over the next decade. Which option would you recommend? Why?
