All of the following are reasons why a company might carry a safety stock except:
A) a buffer against unexpected increases in demand
B) a contingency against the uncertainty about lead time
C) a strategy to lower the carrying cost of inventory
D) a way of softening the impact of sudden unavailability of stock from suppliers

Question

Quizplus · Accepted Answer

Carrying a safety stock would increase the carrying cost of inventory, whereas this option suggests that carrying a safety stock is a strategy to lower it. The other options (A, B, and D) are valid reasons for carrying a safety stock.

All of the Following Are Reasons Why a Company Might