Question

If demand is not uniform and constant, then stockout risks can be controlled by: increasing the EOQ. spreading annual demand over more frequent, but smaller, orders. raising the selling price to reduce demand. adding safety stock. reducing the reorder point.

Answer 1

Answer: Adding safety stock

Step-by-step explanation:

A stockout is when the orders of the customer for a particular product is more than the amount of inventory that is kept on hand and this leads to lost sales, and a negative impact on the long-term relationship with the customer.

Since the demand is not uniform and constant, then stockout risks can be controlled by adding safety stock. The safety stock is asimply the additional quantity of an item which is held in the inventory in order to help to reduce stockout risk.