The Profit-Leverage Effect of Supply Savings Means That

Multiple Choice

The profit-leverage effect of supply savings means that:

A) a reduction in money tied up in inventory improves profits.
B) a reduction in purchase spend increases profit more than an equal sales increase.
C) effective price negotiations with a supplier will lower the supplier's profits.
D) the buyer gains leverage over suppliers when purchases are standardized.
E) efficient and effective supply management processes will increase profits.