Final answer:
The statement provided is false; a high inventory turnover rate actually indicates good sales while a low rate suggests difficulties in selling inventory or overstocking.
Step-by-step explanation:
The statement is accurate. A high inventory turnover rate indeed signifies efficient and rapid sales, indicating strong product demand and effective business operations. This is because a high turnover rate implies that a company is replenishing its stock frequently, aligning with customer needs. Conversely, a low inventory turnover rate suggests sluggish sales or excess stock, signaling potential issues such as overstocking or weak demand.
This slower turnover can lead to holding costs and may be indicative of inefficiencies in the supply chain or marketing strategies. Therefore, contrary to the initial assertion, a high inventory turnover rate generally reflects favorable market conditions and effective inventory management, while a low rate raises concerns about the company's ability to sell its products efficiently.