Discuss about the inventory holding cost factor

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Problem: On the other hand, if Jim's over-forecasted the need at the shelf, they had to take the ice cream back. These products are called "free-ride ice creams." There are definite transportation and inventory holding costs associated with the "free" rides, as well as quality concerns resulting from the thawing and freezing processes of loading and unloading the ice cream.

Question: What does "There were definitely transportation and inventory holding costs associated with the free rides" tell you about the inventory holding cost factor? Is it the same for low inventory levels as it is for high inventory levels? Why?

Reference no: EM131876497

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