If Only Two Products Are Produced in an Economy,corn and Cars,the

question 53

Multiple Choice

If only two products are produced in an economy,corn and cars,the opportunity cost of producing a bushel of corn equals the

• A) gain in cars divided by the loss in corn.
• B) loss in corn divided by the gain in cars.
• C) opportunity cost of producing a car.
• D) gain in corn divided by the loss in cars.
• E) loss in cars divided by the gain in corn.

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Definitions:

Stockouts

The situation when demand cannot be fulfilled due to insufficient inventory, leading to potential loss of sales and customer dissatisfaction.

Safety Inventory

The stock of goods or materials kept on hand to protect against variations in demand or supply.

Lumpy Demand

Demand characterized by unpredictable fluctuations and variability, often challenging for businesses to manage effectively.

Safety Stock

Extra inventory held by a business to protect against stockouts due to variability in demand or supply chain disruptions.