BUISENESS MANAGEMENT
INVENTORY MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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True
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False
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Either A or B
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None of the above
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Detailed explanation-1: -T/F The objective of inventory management is to minimize holding costs. False. The objective of inventory management is to minimize total cost, which includes ordering costs and sometimes purchase costs (e.g. quantity discount models).
Detailed explanation-2: -Answer and Explanation: True, inventory control is one part of minimizing holding costs and potential stock-outs.
Detailed explanation-3: -The objectives of inventory management are to provide the desired level of customer service, to allow cost-efficient operations, and to minimize the inventory investment.
Detailed explanation-4: -Economic order quantity (EOQ) is the ideal quantity of units a company should purchase to meet demand while minimizing inventory costs such as holding costs, shortage costs, and order costs.