Which of the following is a benefit of keeping inventory levels low?

Question

Quizplus · Accepted Answer

Keeping inventory levels low reduces the risk of shrinkage costs, which can occur due to theft, damage, or expiration of the inventory. This allows a business to minimize its costs and maximize efficiency. However, low inventory levels can also lead to the loss from lost sales if demand exceeds supply, making it important for businesses to find the optimal inventory balance. A, C, and D are incorrect as reducing setup costs and inventory turnover, and avoiding lost sales are not direct benefits of keeping inventory levels low, but rather potential consequences that depend on various factors.

Which of the Following Is a Benefit of Keeping Inventory