Asked by Mercy Ikediuba on May 21, 2024

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Verified

Inventory and facility costs increase as the number of facilities in a supply chain increase.

Facility Costs

Expenses associated with the physical means through which a company operates, such as rent, utilities, and maintenance of buildings and equipment.

  • Grasp the relationship between the number of facilities and inventory and facility costs.
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Verified Answer

JH
Jason HoàngMay 21, 2024
Final Answer :
True
Explanation :
As the number of facilities in a supply chain increase, the inventory holding costs and facility rental/maintenance costs also increase. This is because more facilities require more inventory to be held at different locations, and each facility requires its own rent, utilities, and maintenance expenses.