Demand for an item has to be regular and relatively continuous over time for order point models and policies to be applicable.

Question

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Order point models and policies are designed to ensure that inventory levels are maintained at a level sufficient to meet customer demand while avoiding excessive inventory costs. In order to effectively use these models and policies, demand for the item should be regular and relatively continuous over time. If demand is sporadic or unpredictable, other inventory management approaches may be more appropriate.

Demand for an Item Has to Be Regular and Relatively