Tidewater Company uses 100,000 pounds of fresh flowers each year. Because of rising energy costs, it has become more expensive for Tidewater to store flowers. All other factors being equal, Tidewater should _____ its inventory of fresh flowers, which would _____ the risk of running out of inventory
A) reduce; have no effect on
B) increase; have no effect on
C) reduce; increase
D) increase; increase

Question

Quizplus · Accepted Answer

By reducing the inventory of fresh flowers, Tidewater would decrease the risk of running out of inventory because fewer flowers would need to be stored for a shorter amount of time. This would also help mitigate the impact of rising energy costs on storage expenses.

Tidewater Company Uses 100,000 Pounds of Fresh Flowers Each Year