False, A high average inventory value does not reduce the chances of inventory obsolescence.
An estimation of the worth or quantity of a certain commodity or group of goods over two or more specified time periods is known as average inventory. By averaging the beginning and ending inventory values throughout a certain time period, average inventory is the mean value of inventory during that time period, which may differ from the median value of the same data set. The value of all the products that are in stock and ready to be sold, as well as all the raw materials used to make those products, is known as inventory. Since it enables them to better manage their total business in terms of sales, costs, and relationships with their suppliers, successful inventory management is a crucial focus for businesses.
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