The Amount of Safety Stocks Held by a Firm Generally

Multiple Choice

The amount of safety stocks held by a firm generally

A) increases with greater uncertainty of demand forecasts.
B) increases with higher costs (in terms of lost sales and lost goodwill) of stockouts.
C) increases with a greater chance that delays will occur in receiving shipments.
D) decreases as the cost of carrying additional inventory increases.
E) All of the above