Despite the Increased Use of JIT Systems,there Are Several Benefits

question 51

Multiple Choice

Despite the increased use of JIT systems,there are several benefits or advantages to having inventory,they include:

• A) Make possible smooth and efficient operations by decoupling individual segments of the total operation
• B) Inventories of parts and components produced in-house facilitates economical production runs in various machine-assembly stations
• C) Provides "safety" stock for supply interruptions
• D) Finished goods inventory help the marketing/sales department satisfy unexpected customer demand to avoid stockouts
• E) All of the above

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Definitions:

Tail Risk

Risk of extreme events in the far tail of the probability distribution.

Worst-case Scenario

A situation where the most unfavorable conditions lead to the worst possible outcome for a project or investment.

Downside Exposure

The potential loss in value of an investment due to market declines, highlighting the risk in bearish scenarios.

VaR (Value At Risk)

A statistical technique used to measure and quantify the level of financial risk within a firm or investment portfolio over a specific time frame.