Which term describes the relocation of production or services to a foreign country to reduce costs?

• A. Fringe benefits
• B. Wage gap
• C. Collective bargaining
• D. Offshoring

Answer: (D)

Offshoring is the relocation of production or services to a foreign country to reduce costs. By moving factories or support activities abroad, a company can take advantage of lower wages, different regulatory environments, or other cost differences. This term focuses on where production happens—across borders—often while the company may still own the operation or contract it out. The other terms describe different ideas: fringe benefits are extra compensation like health insurance, the wage gap is the difference in pay between groups, and collective bargaining is the process of negotiating wages and working conditions between workers and management.