Afirm benefits by basing each value creation activity it performs at that location where economic, political, and cultural conditions, including relative factor costs, are most conducive to the performance of that activity. firms that pursue such a strategy can realize:
a. differentiation
b. location economies
c. vertical integration
d. horizontal integration

The correct answer is B.location economies .

Explanation:

Economies of location are those obtained by locating industries linked by their complementary relationships in one place. In this way, they can create centers for the purchase of raw materials and the sale of common finished products, shared research centers, the possibility of buying intermediate inputs and selling outputs to companies in the same geographical area with complementary production processes, ease of re-clumping specialized labor, etc.

answer/// real gdp decreases to y3 and the price level falls to p3;