Author Question: An unexpected in inventories has effect on future production. (Read 47 times)

leo leo · **on:** Apr 19, 2019

Question 1

The Yum Yum Bubble Gum Company rents space in a warehouse to store its inventory. The owner of the warehouse just lowered the rent he charges the Yum Yum Bubble Gum Company. Everything else equal, the rent decrease is likely to ________ Yum Yum's optimal level of inventory.

◦ increase
◦ decrease
◦ not change
◦ reduce to zero

Question 2

An unexpected ________ in inventories has ________ effect on future production.

◦ decrease; no
◦ decrease; a positive
◦ increase; a positive
◦ increase; no

aidanmbrowne · **Reply #1 on:** Apr 19, 2019

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