ENTREPRENEURIAL OPERATIONS
INVENTORY MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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The demand for item is dependent upon the demand for some other item
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Used when intervory builds up over a period of time after an order is placed
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The costs of placing an order and receiving goods
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None of the above
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Detailed explanation-1: -What is Dependent Demand? Dependent demand is the demand for component parts, raw materials, or sub-assemblies. This demand does not occur until there is demand for a parent item, which is typically a product.
Detailed explanation-2: -If the demand for inventory of an item is dependant upon another item, such demands are categorized as dependant demand. Raw materials and component inventories are dependant upon the demand for Finished Goods and hence can be called as Dependant demand inventories. Take the example of a Car.
Detailed explanation-3: -Dependent demand, on the other hand, is demand for component parts or subassemblies. For example, this would be the microchips in the computer, the wheels on the bicycle, or the cheese on the pizza.