Question

What factors encourage American businesses to move production to developing countries?

Answer 1

The factors for moving business to developing countries are cost cutting and higher profits.

Explanation:

Setting up production units in developing countries will be make them less expensive in terms of labour and sourcing of raw material which can be easily procured from nearby place where the unit is situated.

So, US companies were making a strategy to capitalise the quality work force at lesser cost and making large volumes of goods to cater the market demands. Supply of finished goods can be sold at lesser price at the US local market which will benefit the customer and it will be crucial to company’s success.  

Answer 2

The developing countries are cheaper for production and labor so it is economically beneficial