Asked by edward duong on May 08, 2024
Verified
Inventories help manufacturers cope with unexpected changes in the supply of their resources or in the demand for their products.
Inventories
Quantities of goods that are held by a company in anticipation of being sold or used in production processes.
Manufacturers
Entities or individuals that use raw materials, parts, and components to produce finished goods through various processes, machinery, and operations.
Unexpected Changes
Unexpected changes refer to unforeseen events or shifts in the marketplace, economies, or natural environment that can significantly impact businesses, economies, and societies.
- Comprehend the idea of investment within the Gross Domestic Product framework and the impact of inventory alterations on the computation of GDP.
Verified Answer
AK
Alexander KnightMay 15, 2024
Final Answer :
True
Explanation :
Inventories provide a buffer to manufacturers to adjust their production rates in response to changes in demand or supply. They help ensure that product availability is maintained even during periods of disruption or uncertainty. Additionally, having a stock of inventory can also help companies take advantage of sudden spikes in demand or unexpected opportunities to sell their products.
Learning Objectives
- Comprehend the idea of investment within the Gross Domestic Product framework and the impact of inventory alterations on the computation of GDP.