The Technique of Fixed-Order Quantity Involves a Company

question 76

Multiple Choice

The technique of fixed-order quantity involves a company:

• A) ordering exactly what is needed.
• B) specifying the number of units to order whenever an order is placed.
• C) placing a replenishment order whenever the on-hand inventory level falls below a minimum level.
• D) determining the order quantity using the total demand for the item in the next n months.
• E) ordering a quantity that will maintain the inventory at a predetermined maximum level.

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Definitions:

Standard Normal

Standard normal refers to a normal distribution with a mean of 0 and a standard deviation of 1.

Area

The quantifiable space within the boundaries of a two-dimensional shape, measured in square units.

Standard Normal

A normal distribution with a mean of 0 and a standard deviation of 1, used as a basis for comparison with other normal distributions.

Standard Deviation

A measure of the amount of variation or dispersion of a set of values; a low standard deviation indicates that the values tend to be close to the mean, whereas a high standard deviation indicates that the values are spread out over a wider range.