I think this is correct. I chose answer E. See screenshot further down to help you answer. Question. Which one of the following is the most trustworthy sign that companies opting to install additional production capacity in the upcoming decision round will likely struggle to avoid the extra costs of having unneeded production capacity and/or excessively large year-end inventories of branded footwear?

a. Less than 55% of the production capacity worldwide is currently located in the Asia-Pacific region because many companies have recently begun production operations in Latin-America and Europe-Africa. b. The number of pairs that can be produced worldwide at full production capacity (including overtime) already exceeds by 20% the combined demand for branded footwear and private-label footwear three years from now (as reported in the most recent years Footwear Industry Report). c. An average of 10,000 pairs of new production capacity have come in line in each of the past three decision rounds, all of which occurred in Latin America, Europe-Africa and Asia-Pacific

d. No companies lost sales due to stock outs in any of the four geographic regions in the most recent decision round. e. In the upcoming year, the Global Supply of footwear exceeds Potential Global Demand by 5 million pairs, as supported in the supply/demand analysis section on page 4 of the most recent Footwear Industry Report.

Demand Forecast NorthEurope Asia Latin Global America Africa Pacific Arica Total Notes Branded Demand 42,703 37.627 39.164 40,340 159.834 Global demand for Y11-Y15 is Year 19 Year 20 Year 21 Year 19 Year 20 Year 21 44.410 39,129 42295 43,565 169.399 46,187 40,691 44,832 46,178 177888 7%-9% annually. Slowing to 590.7% 16-Y20. The intemet+wholesale growth rates are 6,127 6,798 the same for all regions, as shown in the table 6 127 22682 on page 5 of the Player's Guide, Actual demand the forecast due to or weaker compelitive esforts on the Private-Label Demand 5.214 may vary 5,687 6,028 7,205 6,798 24.970 7205 26,466pat oi a companies Supply IDemand Analysis Potential Footwear Suppy in Year 19 Footwear Demand in Year 19 Beginning Year 19 Inventory Potential Y19 ProductionihOT) 216,600 Private-Label Demand Forecast 22,682 orecast I supply (at max OT) in the ear is 40.1% greater than projected global will resut in Global Demand182.516 FIERCE compelition for the next several years Potential Global Supply Companies with underutilized production capability are advised to sel unneeded production equipment Facility Space Production Equipment Year 18 Facility Space Construction of New S Year 18 Production Equipment 000s of pairs avalilable for production) DO0s of pairs available for pred 39,000 A A 6,000 10,000 12,000 11,000 C 7,000 6,000 9,000 10,000 D 5,000 6,000 6,000 6,000 E 5,000 1,000 8,000 6,000 F 6.000 5,000 6,000 6,000 G 5,000 1,000 13,000 7,000 H 8,000 4,000 8,000 10,000 0 6,000 2,000 5,000 5,000 6,000 5,000 0 6.000 3.000 0 32,000 C 0 23,000 D 0 20,000 E 0 23,000 F 0 26,000 G 0 30,000 H 0 13,000 I 4250 0 21,000 0 14,000 K 0 11,000 0 3,000 9,250 6,000 18,250 A 0 3,500 9,000 10,000 22,500 C 0 6,000 6,000 6,000 18,000 D 0 6,750 3,500 10,250 E 4.000 5.000 3,750 5,500 18.250 F 4,250 1,000 13,000 7,000 25,250 G 6,000 4,000 7,000 5,000 22,000 H 0 4,750 1,000 10,000 I I 5,000 0 5,000 6,000 5,000 16,000 K 5,000 L 5,000 0 4,000 3,000 9,000 K 0 11,000 L L 5,000 0 6,000 62,000 38,000 86,000 66,000 0 252,000 25,500 27,500 75,500 52,000 180,500 Demand Forecast NorthEurope Asia Latin Global America Africa Pacific Arica Total Notes Branded Demand 42,703 37.627 39.164 40,340 159.834 Global demand for Y11-Y15 is Year 19 Year 20 Year 21 Year 19 Year 20 Year 21 44.410 39,129 42295 43,565 169.399 46,187 40,691 44,832 46,178 177888 7%-9% annually. Slowing to 590.7% 16-Y20. The intemet+wholesale growth rates are 6,127 6,798 the same for all regions, as shown in the table 6 127 22682 on page 5 of the Player's Guide, Actual demand the forecast due to or weaker compelitive esforts on the Private-Label Demand 5.214 may vary 5,687 6,028 7,205 6,798 24.970 7205 26,466pat oi a companies Supply IDemand Analysis Potential Footwear Suppy in Year 19 Footwear Demand in Year 19 Beginning Year 19 Inventory Potential Y19 ProductionihOT) 216,600 Private-Label Demand Forecast 22,682 orecast I supply (at max OT) in the ear is 40.1% greater than projected global will resut in Global Demand182.516 FIERCE compelition for the next several years Potential Global Supply Companies with underutilized production capability are advised to sel unneeded production equipment Facility Space Production Equipment Year 18 Facility Space Construction of New S Year 18 Production Equipment 000s of pairs avalilable for production) DO0s of pairs available for pred 39,000 A A 6,000 10,000 12,000 11,000 C 7,000 6,000 9,000 10,000 D 5,000 6,000 6,000 6,000 E 5,000 1,000 8,000 6,000 F 6.000 5,000 6,000 6,000 G 5,000 1,000 13,000 7,000 H 8,000 4,000 8,000 10,000 0 6,000 2,000 5,000 5,000 6,000 5,000 0 6.000 3.000 0 32,000 C 0 23,000 D 0 20,000 E 0 23,000 F 0 26,000 G 0 30,000 H 0 13,000 I 4250 0 21,000 0 14,000 K 0 11,000 0 3,000 9,250 6,000 18,250 A 0 3,500 9,000 10,000 22,500 C 0 6,000 6,000 6,000 18,000 D 0 6,750 3,500 10,250 E 4.000 5.000 3,750 5,500 18.250 F 4,250 1,000 13,000 7,000 25,250 G 6,000 4,000 7,000 5,000 22,000 H 0 4,750 1,000 10,000 I I 5,000 0 5,000 6,000 5,000 16,000 K 5,000 L 5,000 0 4,000 3,000 9,000 K 0 11,000 L L 5,000 0 6,000 62,000 38,000 86,000 66,000 0 252,000 25,500 27,500 75,500 52,000 180,500