uestion 1 (2 points) An inventory system answers two important questions: When t
ID: 357713 • Letter: U
Question
uestion 1 (2 points) An inventory system answers two important questions: When to order and how much to order. Which of the following these questions? encnts corectly explains how a Q system (continuous review system) or a P system (periodic review system) answers o a) under a Q system, a fixed quantity Q is ordered when the inventory position reaches the reorder point R. O b) under a Q system, an order is placed to replenish the inventory position up to the target level T every P time periods. c) Under a P system, a fixed quantity is ordered every P time periods. . Under a P system, an order is placed to replenish the inventory position up to the target level T when the inventory position reaches the reorder point R. SaveExplanation / Answer
Under a P system order is placed at regular fixed interval of time ( e.g every 10 days )upto a target maximum inventory point irrespective of quantity at hand which in other words means that P system does not follow reorder point R
Since under P system quantity is ordered upto a target inventory level , the exact quantity ordered will be dependent on inventory at hand at the time o placing order. Since inventory at hand at the time of placing order can vary , it is FALSE to state that under a P system , a fixed quantity is ordered every P time periods
It is also FALSE to state that “ Under a Q system , an order is placed to replenish the inventory position upto the target level T every P time periods” since this is correct description ofa P system
The correct answer which gives a true picture about Q system is “a) Under a Q system , a fixed quantity Q is ordered when the inventory position reaches the reorder point “
ANSWER : a) UNDER A Q SYSTEM , A FIXED QUANTITY Q IS ORDERED WHEN THE INVENTORY POSITION REACHES THE REORDER POINT R
ANSWER : a) UNDER A Q SYSTEM , A FIXED QUANTITY Q IS ORDERED WHEN THE INVENTORY POSITION REACHES THE REORDER POINT R
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