Which of the following relationships illustrates the role of dependent demand inventory?
A)A business purchases a new car when the old one wears out.
B)A tire maker buys cleaning supplies.
C)An automaker purchases four tires for each car they produce.
D)A winemaker buys grapes from farmers in the Columbia Valley.

Question

Quizplus · Accepted Answer

Choice C illustrates dependent demand inventory because the automaker needs four tires for each car they produce. The demand for tires is directly related to the demand for cars. In contrast, choices A, B, and D illustrate independent demand inventory, meaning the demand for the items is not directly related to the production of another item.

Which of the Following Relationships Illustrates the Role of Dependent