Suppose a large retail chain is considering increasing the number of distribution centres that serve its retail stores from 6 to 20. If the number of suppliers, retail outlets, and customers remain unchanged, which of the following statements accurately describes what will happen as a result of this expansion?
A.
Inbound transportation costs to the warehouses will decrease.
B.
Outbound transportation costs from the warehouses increase, and total transportation costs will increase.
C.
Total inventory in the warehouse system will increase.
D.
Average inventory per warehouse will increase.
Answer: C
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