A(n)_____ Is an Amount of Inventory Carried to Ensure That

question 37

Multiple Choice

A(n) _____ is an amount of inventory carried to ensure that a business will not run out of inventory because of fluctuating levels of sales.

• A) micro inventory
• B) safety stock
• C) just-in-time inventory
• D) perpetual inventory

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Definitions:

Excess Reserves

The funds that banks hold over and above the legally mandated minimum to safeguard bank liquidity, which can also be lent out.

Actual Reserves

The funds that a bank has on hand or deposited with the central bank, available for immediate use.

Net Worth

Assets minus liabilities; also called owners’ equity.

Owners' Equity

The residual interest in the assets of a business after deducting its liabilities, representing the ownership interest of shareholders or proprietors.