Question

A difference between periodic review and continuous review inventory systems is:________

a. Periodic review is more expensive than continuous review
b. Continuous review usually required more safety stock than periodic review
c. In one system, time triggers orders, in the other, quantity triggers orders
d. Periodic review requires real-time monitoring systems

Answer 1

The correct answer is the option C: In one system, time triggers orders, in the other, quantity triggers orders.

Step-by-step explanation:

On the one hand, the term known as "Periodic review inventory system" refers to a type of inventory system that mainly is focus on the time that the order takes, therefore that it is said that the system is triggered by time because the orders are taken at the same time every period.

On the other hand, the "Continuous review inventory system" actually is triggered by the quantity of orders that take place every period. Therefore that this system keeps track of the exact amount every period and when that number goes down the system automatically order more of the same amount.