A demand-pull system in which each component in a production line is produced immediately as needed by the next step in the production line is referred to as ________.
A) just-in-time purchasing
B) materials requirements planning
C) relevant total costs
D) economic order quantity

Question

Quizplus · Accepted Answer

The demand-pull system described in the question is known as just-in-time (JIT) manufacturing or production. In this system, each component is produced just in time to be used in the next step of production, reducing inventory and saving costs. Materials requirements planning (MRP) is another inventory management technique that uses a computerized system to determine when and how much inventory is needed, but it is not specific to a demand-pull system. Relevant total costs and economic order quantity (EOQ) are also inventory management concepts, but they are not directly related to the production process described in the question.

A Demand-Pull System in Which Each Component in a Production