Question

In a cost-benefit analysis, what does the use of technology to lower inventory costs represent?

A) Operational efficiency
B) Intangible benefit
C) Tangible benefit
D) Financial risk

Answer 1

In cost-benefit analysis, using technology to lower inventory costs is considered a tangible benefit because it directly reduces expenses and can be quantified in financial terms.

Step-by-step explanation:

In a cost-benefit analysis, the use of technology to lower inventory costs represents a C) Tangible benefit. This is because tangible benefits are those that can be quantified or measured directly in financial terms. Using technology to reduce inventory costs leads to a direct reduction in expenses, which can be clearly quantified and is therefore considered a tangible benefit. By decreasing inventory levels through improved technology, firms can reduce the costs associated with storage, spoilage, and capital tied up in stock, ultimately affecting the company's bottom line.