As the uncertainty of supply or demand grows,the required level of safety inventories

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As uncertainty increases, the required level of safety inventories also increases. This is because safety inventories act as a buffer against unexpected changes in demand or supply. With higher uncertainty, there is a greater likelihood of such unexpected changes occurring, necessitating a higher level of safety inventory to mitigate the associated risks. Option A is incorrect because the level of safety inventory decreases only when there is greater certainty in supply and demand, as it reduces the need for a buffer. Option C is incorrect because stable demand/supply conditions do not cause any changes in required safety inventory levels. Option D is incorrect because both options cannot be true simultaneously.

As the Uncertainty of Supply or Demand Grows,the Required Level