I dont know abt question 1.
regarding q2. more buying needs more capex. basically more expense. if they have inventory worth 3 month demand, then if they buy more, it will be more inventory on top of existing 3 month inventory.
what if demend reduces in near future, then they will be holding inventory which has no demand. there will be more warehousing cost, holding cost. cost of secruity, safety etc. so company never buys more than its required, more capital will be stuck with inventory.
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