Safety Stock Is Kept in Order To

question 15

Multiple Choice

Safety stock is kept in order to:

• A)Guard against defective products.
• B)Prevent losses created by a stockout
• C)Prevent people from being injured by dangerous inventory
• D)Help identify the reorder point

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Definitions:

Forward Contract

A financial derivative contract between two parties to buy or sell an asset at a specified future date for a price agreed upon today.

Canadian Dollars

The currency of Canada, represented by the symbol CAD or C$.

Foreign Exchange Risk

The possibility of losing value due to changes in currency exchange rates.

Spot Rate

The current market price at which a particular asset, such as foreign currency, can be bought or sold for immediate delivery.