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Q. Explain about Inventory Economies?
Inventory Economies:Role of inventories is to aid the firm in meeting random changes in the output and the input sides of the operations of the firm. Purpose of inventories is to smooth out the supply of outputs and the supply ofinputs.
Inventories on spare parts, raw materials and finished products increase with the scale of production though they don't increase proportionately with the increase in size of output. Hence as the size of output amplifies the firm can hold smaller percentage of inventories to meet random changes.
Drafting of Price Policy: Demand forecasts assist the management to prepare a few appropriate pricing systems, so that level of price doesn't fall and rise to a great extent at th
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is the sales maximization applicable
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a) A reduce in supply and an enhance in demand will cause the equilibrium: b) Which of the following is most likely to cause a reduce in the present demand for some product X
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