Question

The efficiency gains resulting from a just-in-time inventory management system will allow a firm to reduce its level of inventories permanently by $333,000. What is the most the firm should be willing to pay for installing the system

Answer 1

Since the benefits of adopting a just-in-time inventory management system are $333,000, and these benefits are permanent; then we can assume that the company should be willing to pay up to $333,000 for installing the system. This amount varies depending on maintenance expenses or the costs of operating the system.

Step-by-step explanation: