Explain the tradeoffs involved in setting an ideal level of inventory for a particular product. What are the costs if too much is maintained? What are the costs if too little is maintained?
Inventory is the number of goods and services stored and is accompanied asset and thus management of that asset is a very important aspect of the business.
If too much inventory is maintained the inventory can lead to liability. If too little inventory is maintained then it leads to shortages of raw material and work in progress.
