The percentage variation method (PVM)of inventory planning assumes that the percentage fluctuations in monthly stock from average stock should be half as great as the percentage fluctuations in monthly sales from average sales.

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This statement is true. The percentage variation method (PVM) is a popular inventory planning technique that aims to maintain optimal inventory levels by adjusting stock levels based on the percentage fluctuations in monthly sales and average stock. According to this method, the percentage fluctuations in monthly stock from average stock should be half as great as the percentage fluctuations in monthly sales from average sales. This helps businesses to keep the right amount of inventory on hand to meet customer demand without overstocking or understocking.

The Percentage Variation Method (PVM)of Inventory Planning Assumes That the Percentage