Off-shoring involves relocating production to another country primarily to achieve which objective?

• A. Avoid tariffs
• B. Increase tariffs
• C. Access cheaper production costs
• D. Improve domestic consumer protection

Answer: (C)

Off-shoring is essentially about cutting the cost of making goods by moving production to a country where inputs are cheaper. Firms do this to lower wages, materials, or operating costs, and sometimes to benefit from favorable taxes or regulations. The main goal is to reduce the total cost per unit of output, which is why accessing cheaper production costs best fits the idea.

Tariff avoidance isn’t the primary aim—tariffs add costs rather than reduce them, and the decision to offshore isn’t made to dodge them. Increasing tariffs would raise costs, not lower them. Improving domestic consumer protection is about regulation and safeguards at home, not about where production happens. So the strong, central motive behind off-shoring is to access cheaper production costs.