Which Statement Is Most Accurate When Deciding How Much and When

question 22

Multiple Choice

Which statement is most accurate when deciding how much and when to buy?

• A)Balance price,volume,carrying cost,and the cost of stock-outs.
• B)Use the forecast future demand,lead times,and prices to determine optimal order volume.
• C)Determine the price premium to attain the desired order quantity.
• D)Managers seldom make purchase decisions until they are absolutely sure of the volume required.
• E)The costs of placing orders and holding inventory are so low they do not significantly affect the decision of how much to buy.

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Definitions:

Explanatory Variable

In statistical modeling, an explanatory variable is one that is manipulated or categorized to assess its effect on a response variable.

Scatterplot

A type of graph used in statistics to display values for two variables for a set of data.

Density Curve

A smooth curve used in statistics to describe the distribution of a continuous probability variable; its area under the curve sums to 1.

Boxplot

A graphical representation of data that displays the distribution's quartiles and median, helping to visualize central tendency, dispersion, and outliers.