The Data Used to Calculate the Order Point Include All

question 25

Multiple Choice

The data used to calculate the order point include all of the following except:

• A)the costs of placing an order.
• B)the rate at which the material will be used.
• C)the estimated time interval between the placement and receipt of an order.
• D)the estimated minimum level of inventory needed to protect against stockouts.

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Definitions:

Market Failure

A situation where the allocation of goods and services is not efficient, often leading to a net social welfare loss.

Goods

Physical items produced for sale or use, characterized by their tangibility and their capacity to satisfy human wants or needs.

Free-rider Problem

A situation in which some individuals consume more than their fair share of a public resource, or shoulder less than a fair share of the costs of its production, without contributing to its provision.

Market Failure

A situation where the allocation of goods and services by a free market is not efficient, often leading to a net social welfare loss.