Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Name one (or more) of the most persuasive arguments for building inventory as part of a cogent demand plan in a make-to-stock oriented production operation.
Name one (or more) of the most persuasive arguments for building inventory as part of a cogent demand plan in a make-to-stock oriented production operation. a. This is the way to respond to customer demand when production leadtime is longer than Customer Expected Leadtime (CELT). b. The equipment purchased can run at high utilization rates and therefore provide better economies for when the product does sell. This is the best way to get return for capital invested. c. Management has made a commitment to the street/stakeholders around investment, return, and performance. Inventory can be made in many cases such that we can decouple (temporarily) the financial requirements from the operational and demand uncertainties if we can sell inventory later at full price. d. a & c
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started