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Question 7: Which of the following situations is an example of inventory being held as a way to balance
supply and demand?
A.A manufacturer holds inventory of key components to maintain a level production schedule.
B.A manufacturer of seasonal products builds finished-goods inventory before the peak selling
period.
C.A distributor maintains safety stock of slow-moving items at a central distribution center.
D.A retailer stocks a variety of sizes and colors of a fast-selling item to avoid losing sales.
Correct Answer: B
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