The Optimal Safety Stock Level Is the Quantity of Safety

question 87

Multiple Choice

The optimal safety stock level is the quantity of safety stock that minimises the sum of the annual relevant:

• A)ordering costs and purchasing costs.
• B)stockout costs and carrying costs.
• C)ordering costs and carrying costs.
• D)ordering costs and stockout costs.

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Definitions:

Economics

The discipline within social science that examines the decision-making process of individuals, governments, companies, and countries in distributing resources to fulfill their desires and requirements.

S Corporations

A special tax status granted to certain corporations, allowing income to be passed through to shareholders and taxed at individual rates.

Proprietorship

A business owned and operated by a single individual, with no legal distinction between the owner and the business.

Taxed

This pertains to the imposition of a financial charge or levy upon a taxpayer by a governmental organization.