Which of the Following Is Correct Regarding Future Demand for Component

question 42

Multiple Choice

Which of the following is correct regarding future demand for component parts?

• A) Future demand in an order-point system is based on the master production schedule.
• B) Future demand in an MRP system is based on the past history of demand for each component part.
• C) Future demand in an MRP system is based on the master production schedule.
• D) None of the above.

---

Definitions:

Money Multiplier

A factor that quantifies the amount of money that banks generate with each unit of reserves.

Reserve Ratio

The fraction of deposits that banks are required to keep on hand as reserves, aimed at ensuring liquidity and controlling the money supply.

Discount Rate

The interest rate charged by central banks on loans they offer to commercial banks or the rate used in discounted cash flow analysis to determine the present value of future cash flows.

Money Supply

The full tally of available monetary resources in an economy at a specified time, comprising cash, coins, and checking and savings account funds.