1.The just-in-time inventory system is designed to reduce the inventory period. In essence, companies pay their suppliers to carry the inventory for them. Reducing the inventory period reduces the operating cycle and thus the cash cycle. This reduces the need for financing. Consider what type of cost is being minimized and what costs are likely to increase. Please, explain. Are JIT inventory policies appropriate for all industries?

2.One option a firm usually has with any excess cash is to pay its suppliers more quickly. What are the advantages and disadvantages of this use of excess cash?

Another option available to the firm would be to reduce the firm's outstanding debt. What are the advantages and disadvantages of this use of excess cash?