Assertion (A): Inventory decisions involve a cost-service balance. Reason (R): Too little stock causes shortages, while excess stock raises holding cost.

For the following practice assertion–reason questions, choose: (A) Both A and R are true, and R correctly explains A. (B) Both are true, but R does not correctly explain A. (C) A is true, but R is false. (D) A is false, but R is true.

Answer – (A) Both are true and the reason explains the assertion.