Beta Company has entered into an arrangement with Big Auto, Inc., under which Beta will supply automotive seating to Big Auto's assembly plant on a just-in-time basis. In order to respond to Big Auto's fluctuating demands, Beta must maintain substantial inventories of raw materials and adequate idle capacity. Beta has:

Question

Quizplus · Accepted Answer

Beta Company has prioritized the ability to respond quickly to Big Auto's varying demands, which requires maintaining large inventories and idle capacity. This approach sacrifices efficiency, as it involves higher costs and potentially lower utilization of resources, in favor of responsiveness to customer needs.

Beta Company Has Entered into an Arrangement with Big Auto