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Which of following is a TRUE statement about inventory within a continuous review system?

a. When service level increases, Economic Order Quantity increases
b. When ordering or setup costs decrease, Economic Order Quantity increases
c. When ordering or setup costs increase, Economic Order Quantity increases
d. When holding costs increase, Economic Order Quantity increases
e. When demand decreases, Economic Order Quantity increases

Respuesta :

eooyibo123

Answer:

c. When ordering or setup costs increase, Economic Order Quantity increases

Explanation:

In inventory there are two types of review systems used to replenish stock, the periodic inventory and continuous inventory.

Continuous inventory involves ordering the same quantity of a good in each order. However the rate at which goods are replenished varies based on monitoring of level of goods. Orders are made when inventory gets to a certain level.

In this instance when there is an increase in ordering or setup there needs to be allocation of a higher amount for orders. The additional cost is added to the economic order quantity

ayfat23

Statement that can be considered as a true statement as regards inventory that exists in continuous review system is C:When ordering or setup costs increase, Economic Order Quantity increases.

  • Inventory can be regarded as goods as well as materials that is been held by business so that they can resale, or for production purposes.

  • In a continuous review system, when setting up  a increase in cost of goods, then the Economic quantity order will increase.

Therefore, option C is correct.

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https://brainly.com/question/14184995?referrer=searchResults

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