How Does a JIT System Achieve the Objective of Minimizing

question 26

Multiple Choice

How does a JIT system achieve the objective of minimizing purchase costs without carrying inventory?

• A) by ensuring that sufficient inventory is on hand to prevent stockouts
• B) by purchasing extra raw materials when purchase price discounts are offered
• C) by negotiating long-term contracts with supplier to lock in low purchase prices
• D) by selecting an inventory level that minimizes the total of ordering and carrying costs

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