Which of the following is a function of inventory?
A)to decouple various parts of the production process
B)to provide a selection of goods for anticipated customer demand and to separate the firm from fluctuations in that demand
C)to take advantage of quantity discounts
D)to hedge against inflation
E)All of the above are functions of inventory.

Question

Quizplus · Accepted Answer

All of the given choices are functions of inventory. 
A) Inventory helps in decoupling various parts of the production process by allowing them to operate at their individual optimal rates.
B) Inventory provides a buffer for anticipated customer demand and helps in separating the firm from fluctuations in that demand.
C) Inventory helps in taking advantage of quantity discounts by allowing the firm to buy in bulk and reduce per-unit costs.
D) Inventory can be used as a hedge against inflation by buying inventory at the current price and selling it later when the price increases.

Which of the Following Is a Function of Inventory