Suppose the order-up-to model is used to manage inventories. The firm is planning changes that will reduce the lead time to receive replenishments because the firm anticipates that the coefficient of...

Suppose the order-up-to model is used to manage inventories. The firm is planning changes
that will reduce the lead time to receive replenishments because the firm anticipates that
the coefficient of variation of demand will increase even though mean demand per period
remains the same. What can be said about the likely change in the firm’s on-order inventory?

a. It will surely decrease.
b. It will remain the same.
c. It will surely increase.
d. More information is needed to determine the impact of these changes