Which of These Conditions Is Likely to Cause a Decrease

question 42

Multiple Choice

Which of these conditions is likely to cause a decrease in the probability of a stockout?

• A)higher lead time variance
• B)lower lead time
• C)higher demand level variance
• D)lower service level

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Definitions:

Gross Profit

The difference between revenue and the cost of goods sold before accounting for certain other costs.

Intra-entity Sales

Transactions of goods or services between divisions or units within the same legal entity.

Equity Method

A technique where an investor reflects its share of an associate's or joint venture's profits or losses in its own financial statements, affecting the carrying value of the investment.

Income Recognition

The process of reporting income when it is earned and realized or realizable, according to accounting principles.