The purpose of safety stock is to
A) eliminate the possibility of a stockout B) control the likelihood of a stockout due to the variability of demand during lead time C) replace failed units with good ones D) eliminate the likelihood of a stockout due to erroneous inventory tally
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Answer:
B) control the likelihood of a stockout due to the variability of demand during lead time
Explanation:
The purpose of safety stock is to control the likelihood of a stockout due to the variability of demand during lead time. Stockouts contribute to the direct loss of any type of business
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