The Physical Distribution Concept Says (Or Implies) That

question 135

Multiple Choice

The physical distribution concept says (or implies) that:

• A) transporting, storing, and product-handling are unrelated activities for cost control.
• B) the best distribution system is the lowest cost one.
• C) a firm should seek to minimize the total cost of transporting, storing, and product-handling-for a given level of customer service.
• D) if the transporting department minimizes its costs and the storing department minimizes its costs and the product-handling department minimizes its costs-then the total cost of physical distribution will be minimized.
• E) None of these alternatives is correct.

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Definitions:

Outside Supplier

An external entity that provides goods or services to a company, often used in the context of manufacturing or production.

Required Units

The amount of products that need to be produced to meet customer demand or sales forecasts.

Supplying Commitment

An agreement or pledge by a supplier to provide a specified quantity of product to a purchaser at a predetermined time and price.

Financial Advantage

The benefit gained in financial terms from an action or investment, often measured in terms of profits, savings, or enhanced value.