One role of holding inventory is to hedge against anticipated increases in the cost of the inventoried items.

Name: One role of holding inventory is to hedge against anticipated increases in the cost of the inventoried items.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Holding inventory allows a company to anticipate increases in the cost of the items being inventoried and purchase them at a lower cost before the anticipated increase. This is a form of hedging against future price increases.

One Role of Holding Inventory Is to Hedge Against Anticipated