Answer to Question 1
B
Answer to Question 2
When the firm facing a decision encounters one of the following situations, they should consider having the research performed by an outside agency. Here are some reasons for this:
(1) An outside agency often can provide a fresh perspective.
(2) An outside agency often can be more objective.
(3) An outside agency may have special expertise.
(4) An outside agency will have local knowledge and expertise and may specialize in research from its home area.
Likewise, there are conditions that make in-house research more attractive:
(1) The research project needs to be completed very quickly.
(2) The research project will require the close collaboration of many other employees from diverse areas of the organization.
(3) Costs are a concern In-house research can almost always be done more cheaply than that done by an outside firm.
(4) Secrecy is a major concern.
