A push-through system that manufactures finished goods for inventory on the basis of demand forecasts is referred to as:
A)just-in-time purchasing.
B)economic order quantity (EOQ).
C)materials requirements planning.
D)relevant total costs.

Question

Quizplus · Accepted Answer

A push-through system that manufactures finished goods for inventory on the basis of demand forecasts is known as materials requirements planning (MRP). Option A, just-in-time purchasing, is a system designed to minimize inventory levels and requires a pull approach based on actual demand. Option B, economic order quantity (EOQ), is a formula used to determine the optimum order quantity in a traditional inventory management approach. Option D, relevant total costs, is a cost management approach that considers all relevant costs associated with a decision. None of these options fit the description given in the question.

A Push-Through System That Manufactures Finished Goods for Inventory on the Basis