The Two Most Basic Inventory Questions Answered by the Typical

question 130

Multiple Choice

The two most basic inventory questions answered by the typical inventory model are

• A) timing and cost of orders
• B) quantity and cost of orders
• C) timing and quantity of orders
• D) order quantity and service level
• E) ordering cost and carrying cost

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Definitions:

Basis Point

A unit of measure used in finance to describe the percentage change in the value or rate of a financial instrument, equal to 1/100th of 1%.

Bond Prices

The cost or value of a bond, which can fluctuate based on interest rates, credit quality of the issuer, and other factors.

Yields

Yields refer to the earnings generated and realized on an investment over a particular period, expressed as a percentage based on the investment’s cost, its current market value, or its face value.

Debentures

A type of debt instrument not secured by physical assets or collateral but based on the creditworthiness and reputation of the issuer.