If Quick Response Allows Multiple Orders in the Season

question 31

Multiple Choice

If quick response allows multiple orders in the season,

• A)profits decrease and the overstock quantity decreases.
• B)profits decrease and the overstock quantity increases.
• C)profits increase and the overstock quantity decreases.
• D)profits increase and the overstock quantity increases.

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Definitions:

Unrealized Gain

The hypothetical profit on an investment that has not yet been sold, and thus, not yet converted into actual cash.

Hedged Item

An asset, liability, or planned transaction exposed to price risks that are offset by using a hedging instrument.

Anticipated Transaction

A future financial operation or deal that is expected to occur.

Existing Asset

Assets that are currently in possession or use by a company, as opposed to newly acquired or disposed assets.