Your company has been informed that a major supplier is doubling the order processing fee it charges customers from $10 to $20 per order. Meanwhile general interest rates have risen from 1% to 4% due to rapid economic growth in the economy. What else would have to occur for this data not to affect inventory planning by a company?

Question

Quizplus · Accepted Answer

If units sold were to double, this would offset the impact of the increased processing fee and higher interest rates on inventory planning. The company would still be able to maintain the same level of inventory without having to adjust their planning. Prices, total costs, holding costs, and minimum cost points are all independent variables that would not directly impact the effects of the supplier fee and interest rates on inventory planning.

Your Company Has Been Informed That a Major Supplier Is