What describes a corporate decision to transfer much of production responsibility to independent suppliers?

• A. Turnkey Operation
• B. Outsourcing
• C. Foreign Direct Investment
• D. Joint Venture

Answer: (B)

Outsourcing is when a company shifts production tasks to independent suppliers outside the organization, usually to cut costs, gain access to specialized capabilities, or increase flexibility while focusing on its core strengths. This description fits because production responsibility is being moved to external contractors rather than kept in-house.

A turnkey operation involves delivering a fully finished facility or project that’s ready to operate, not transferring ongoing production to outside firms. Foreign direct investment means owning and controlling production facilities in another country, which is about ownership, not simply outsourcing. A joint venture creates a new, jointly owned entity with shared control, rather than outsourcing to separate suppliers.