The ________________ motive for holding inventory links the level of inventory to ongoing anticipated demand.

Question

Quizplus · Accepted Answer

The transaction motive for holding inventory is directly related to fulfilling anticipated demand. This motive is associated with ongoing operational activities that require inventory to maintain production and sales. The speculative motive is linked to taking advantage of potential price increases or shortages, while the precautionary motive is related to holding inventory as a buffer against unexpected events such as supply chain disruptions. Just-in-time is a inventory management approach that seeks to minimize inventory levels and optimize production processes.

The ________________ Motive for Holding Inventory Links the Level of Inventory