Which of the Following Statements Is FALSE

question 2

Multiple Choice

Which of the following statements is FALSE?

• A)Firms may hold inventory because factors such as seasonality in demand mean that customer purchases do not perfectly match the most efficient production cycle.
• B)Inventory helps minimize the risk that the firm will not be able to obtain an input it needs for production.
• C)If a firm holds too much inventory,stock-outs,the situation when a firm runs out of product,may occur,leading to lost sales.
• D)Because excessive inventory uses cash,efficient management of inventory increases firm value.

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Definitions:

Nonlinear

Not forming a straight line; describes relationships in which change in one quantity does not produce a proportional change in another.

Negative

A term used to describe values less than zero, or situations or attitudes that are pessimistic or undesirable.

Strong

Often used in various contexts to imply intensity or robustness; in statistics, it may refer to strong correlation or evidence supporting a hypothesis.

Litres Remaining

A measure indicating the volume of liquid left in a container, usually measured in liters.