Costs Associated with Holding Inventories and the Resulting Opportunity Cost

question 33

Multiple Choice

Costs associated with holding inventories and the resulting opportunity cost of the investment tied up in inventory fall into which of the following categories?

• A)carrying costs
• B)ordering costs
• C)quality costs
• D)stockout costs
• E)stockin costs

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Definitions:

Flexibility

The quality of being able to adapt to new, different, or changing requirements and situations.

Fluency

The ability to express oneself easily and articulate smoothly in a language.

Brain-Storming Process

A creative group activity aimed at generating a large number of ideas to solve a problem, without initially judging or evaluating them.

Written Ideas

Ideas or concepts that have been documented in writing, facilitating communication, analysis, and further development.