If Demand Is Not Uniform and Constant, Then Stockout Risks

question 161

Multiple Choice

If demand is not uniform and constant, then stockout risks can be controlled by:

• A) increasing the EOQ.
• B) spreading annual demand over more frequent, but smaller, orders.
• C) raising the selling price to reduce demand.
• D) adding safety stock.
• E) reducing the reorder point.

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Definitions:

Pharmaceutical Manufacturers

Companies involved in the discovery, development, and production of drugs and medications for medical use.

Negligence

A failure to behave with the level of care that someone of ordinary prudence would have exercised under the same circumstances, leading to unintended harm to others.

Proximate Cause

The primary reason something occurred in law, determining liability based on the directness of the relationship between an action and a harm.

Duty of Care

A legal obligation which is imposed on an individual requiring adherence to a standard of reasonable care while performing any acts that could foreseeably harm others.