The advantage of carrying enough manufacturing capacity to meet demand in any period is very low inventory costs,because no inventory needs to be carried from period to period.

Question

Quizplus · Accepted Answer

When a company has enough manufacturing capacity to meet demand in any period, it can produce only what is needed and eliminate the need for carrying inventory from period to period. This reduces inventory costs, as there is no risk of excess inventory becoming obsolete or lost due to spoilage or theft. Therefore, the statement is true.

The Advantage of Carrying Enough Manufacturing Capacity to Meet Demand