In terms of outsourced functions, what is a potential cost-saving benefit?

The correct answer emphasizes the potential to reduce costs associated with maintaining in-house operations. When a business outsources certain functions, it can lower expenses by eliminating the need to invest in specialized equipment and labor. This allows the company to allocate resources more efficiently, focusing on core areas of expertise while leveraging the capabilities of external providers who can often deliver the same services at a lower cost due to economies of scale or specialization.

Outsourcing enables businesses to avoid the fixed costs of hiring full-time staff and purchasing expensive equipment that may only be needed intermittently. Instead, they can pay for these services as needed, converting fixed costs into variable costs, which provides greater financial flexibility.