A shrewd supply chain manager would aggregate only safety inventory and use an inexpensive mode of transportation for replenishing cycle inventory if she is dealing with a
A)high-value product and high demand.
B)high-value product and low demand.
C)low-value product and high demand.
D)low-value product and low demand.

Question

Quizplus · Accepted Answer

When dealing with a low-value product and low demand, it is not economical to spend more money on transportation than necessary. Therefore, using an inexpensive mode of transportation to replenish cycle inventory would be the best choice. Aggregating only safety inventory also makes sense in this scenario, as there is low demand and it is not worth carrying excess inventory.

A Shrewd Supply Chain Manager Would Aggregate Only Safety Inventory