You are the owner of a company that makes industrial sewing machines. Currently, your company’s profits are decreasing because your competitors have lower prices. You cannot lower the price of your machines without losing a significant amount of money. The majority of your costs come from labor. You have 2,000 employees in your factory, and your company is the primary employer in the community. You could sell your product for a third of the price if you outsourced half your production to a foreign country. However, this would eliminate 1,000 jobs and devastate the community. Also, the country that you would be outsourcing to has a reputation for unsafe working conditions and practices. If you don’t outsource some of your production, over time your company may be unable to compete, possibly forcing you to shut down your company.