Which of the Following Is Not One of the 10

question 7

Multiple Choice

Which of the following is not one of the 10 warning signs that a business is growing too fast?

• A) the business's accountants are starting to worry
• B) productivity is falling
• C) e-mail starts going unanswered
• D) borrowing money to pay for routine expenses
• E) comfortable profit margins

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Definitions:

Costs of Understocking

Expenses incurred due to insufficient inventory levels, leading to lost sales, backorders, and potentially damaged customer relationships.

Cycle Service Level

A performance metric that measures the probability of meeting customer demand without stockouts within a given inventory cycle.

Profitability

A measure of the efficiency and effectiveness of a company's operations, indicated by its ability to generate income relative to revenue, assets, equity, or other financial metrics.

Demand Uncertainty

Refers to the unpredictability of customer demand for a product or service, making it difficult for companies to accurately predict sales volumes.