The average inventory level and the number of orders per year are inversely related: As one increases, the other decreases.

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Quizplus · Accepted Answer

This is because when the average inventory level increases, it implies that a company is holding more stock, which typically reduces the need to place orders frequently, thus decreasing the number of orders per year. Conversely, if a company keeps lower levels of inventory, it will need to order more frequently, increasing the number of orders per year.

The Average Inventory Level and the Number of Orders Per