The Number of Kanbans Decreases as Safety Stock Is Increased

question 96

True/False

The number of kanbans decreases as safety stock is increased.

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Definitions:

Relevant Cost

Costs that differ between alternatives in a decision-making process, and therefore, should be considered when evaluating those alternatives.

Avoidable Costs

Expenses that can be eliminated if a particular decision is made, such as discontinuing a product or service.

Sunk Costs

Costs that have already been incurred and cannot be recovered or changed.

Business Segment

A division within a company that generates its own revenue and expenses, often focusing on a specific product or market.