a. Our suppliers switch from delivering by train to air freight.

b. We change from producing just in time to meet seasonal sales to steady, year-round production.

c. Competition in the markets in which we sell increases.

d. The rate of general inflation increases.

e. Interest rates rise; other things are constant.

(a) Lower safety stock will be required because delivery time is shortened.

(c) On the one hand, the need to stay competitive may require large inventories, but if the market gets competitive, sales may fall off and the need for inventories may diminish.

(e) EOQ and inventories are lower, since carrying costs are higher.