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Questions and Answers
What is the primary purpose of holding higher levels of safety stock in a supply chain?
What is the primary purpose of holding higher levels of safety stock in a supply chain?
- To mitigate the impact of potential disruptions (correct)
- To reduce inventory costs
- To improve forecasting accuracy
- To increase the level of production
Which of the following events would most likely require higher levels of safety stock in a supply chain?
Which of the following events would most likely require higher levels of safety stock in a supply chain?
- A labor strike (correct)
- A sale of excess inventory
- A change in consumer preferences
- A decrease in demand
What is the primary benefit of holding higher levels of safety stock in a supply chain?
What is the primary benefit of holding higher levels of safety stock in a supply chain?
- Improving supply chain flexibility
- Reducing the risk of stockouts (correct)
- Reducing inventory turnover
- Increasing the level of production
In what type of situation would holding higher levels of safety stock be most beneficial?
In what type of situation would holding higher levels of safety stock be most beneficial?
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What is the relationship between supply chain disruptions and safety stock levels?
What is the relationship between supply chain disruptions and safety stock levels?
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Why do companies hold higher levels of safety stock in the face of supply chain disruptions?
Why do companies hold higher levels of safety stock in the face of supply chain disruptions?
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