Question
Is it possible for two firms to have the same annual inventory turns and the same gross-margin but different days-of-supply? A.Yes, because days-of-supply measures how
Is it possible for two firms to have the same annual inventory turns and the same gross-margin but different days-of-supply?
A.Yes, because days-of-supply measures how long the firm can satisfy demand with its current inventory whereas inventory turns measures the frequency at which inventory
turns over.
B.Yes, inventory turns and gross margin are related but they are independent of days-of-supply.
C.Yes, the firm with the higher days-of-supply will have the lower return on invested capital.
D.No, if firms have the same gross-margin then they must have the same days-of-supply.
E.No, if firms have the same inventory turns then they must have the same days-of-supply.
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