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

Question

Quizplus · Accepted Answer

The main difference between periodic review and continuous review inventory systems is the trigger for ordering. In periodic review, the system places an order at a fixed time interval, while in continuous review, an order is triggered when inventory reaches a certain level or reorder point. Therefore, the correct answer is C, as it accurately describes the fundamental difference between the two systems. The other options are not necessarily true statements about periodic and continuous review inventory systems.

A Difference Between Periodic Review and Continuous Review Inventory Systems