The Purpose of Safety Stock Is to

question 43

Multiple Choice

The purpose of safety stock is to

• A) replace failed units with good ones
• B) eliminate the possibility of a stockout
• C) eliminate the likelihood of a stockout due to erroneous inventory tally
• D) control the likelihood of a stockout due to the variability of demand during lead time
• E) protect the firm from a sudden decrease in demand

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Definitions:

Suspiciousness

A tendency to believe, without adequate evidence, that others may be deceiving, harming, or exploiting oneself.

Schizoid Personality Disorder

A mental health condition defined by a persistent tendency to withdraw from social interactions and exhibit a narrow spectrum of feelings.

Claustrophobia

A disorder characterized by an intense fear of being in enclosed or narrow spaces.

Agoraphobia

A type of anxiety disorder characterized by an intense fear of being in situations where escape might be difficult or help might not be available, especially in open or public places.