Question1

Why do organizations hold inventories?

A. To achieve transactional efficiency

B. A result of speculation of price fluctuation

C. Hedge to protect against uncertainty in demand and/or supply

D. Strategic positioning

Question3

When we order inventories too often, the ordering costs will be _____, but inventory holding cost will be _____. (Fill in the blanks).

Low, low

Low, high

High, low

High, high

4.

Question4

If the exact quantity calculated by the EOQ model is ordered, then the inventory carrying costs are _____ ordering costs. (Fill in the blank)

a Greater than

b Less than

c. Equal to

d. None of the above