APICS CPIM-8.0 Exam - Topic 8 Question 3 Discussion

Actual exam question for APICS's CPIM-8.0 exam

Question #: 3
Topic #: 8

[All CPIM-8.0 Questions]

Which of the following systems would be the most cost-efficient for inventory management of a low value item?

AOrder point

BMaterial requirements planning (MRP)

CPeriodic review

DEconomic order quantity (EOQ)

Show Suggested Answer

Suggested Answer: C

Periodic review is a system that determines the order quantity and reorder point for an item based on the inventory position at fixed intervals. This system is suitable for inventory management of low value items, as it reduces the ordering and holding costs, simplifies the ordering process, and allows for grouping orders. Therefore, option C is correct. Option A is incorrect because order point is a system that triggers an order when the inventory level falls below a predetermined level. This system requires continuous monitoring of inventory levels, which may not be cost-efficient for low value items. Option B is incorrect because material requirements planning (MRP) is a system that calculates the requirements for components and materials based on the demand for end items. This system is more appropriate for items with dependent demand, rather than independent demand. Option D is incorrect because economic order quantity (EOQ) is a system that determines the optimal order quantity that minimizes the total ordering and holding costs. This system assumes constant and known demand and lead time, which may not be realistic for some items.Reference: CPIM Part 2 Exam Content Manual, Version 8.0, Section E: Plan and Manage Inventory, Subsection E.2: Inventory Management Methods, p. 53.

by Catherin at Mar 07, 2025, 03:11 AM

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Avery

3 months ago

Not sure if EOQ is the best choice for everything, though.

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Rolland

3 months ago

Order point is super simple and cost-efficient too!

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Lezlie

3 months ago

Wait, isn't Periodic Review better for low value items?

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Audra

4 months ago

Totally agree, EOQ minimizes costs effectively!

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Lashawna

4 months ago

I think Economic Order Quantity (EOQ) is the way to go for low value items.

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Louann

4 months ago

I have a vague memory of the order point system being cost-efficient, but I need to double-check that.

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Luisa

4 months ago

I feel like MRP could be overkill for low value items, but I can't recall the specifics.

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Stanton

4 months ago

I remember practicing with EOQ questions, and it seems like it’s more suited for higher value items.

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Winifred

5 months ago

I think the periodic review system might be the best choice for low value items, but I'm not entirely sure.

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Miesha

5 months ago

I've got this! Order point is definitely the way to go for low-value inventory. It's the most straightforward and requires the least overhead. Periodic review could work too, but order point is the clear winner here in terms of cost efficiency.

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Josefa

5 months ago

Okay, let me see. For low-value items, I'd guess that a simpler system like order point or periodic review would be more cost-efficient than the more complex MRP or EOQ. But I'll double-check my understanding just to be sure.

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Carissa

5 months ago

Hmm, not sure about this one. I know there are different inventory management systems, but I'm a bit fuzzy on the details and tradeoffs. Might need to review my notes before answering.

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Mila

5 months ago

This seems like a straightforward operations management question. I'll think through the key factors for low-value inventory - cost efficiency is the main priority here.

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Carmela

11 months ago

I see your point, Dierdre. It really depends on the specific characteristics of the item being managed.

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Xuan

11 months ago

That's true, Periodic review could be more practical for items with low value and less demand variability.

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Gearldine

11 months ago

A classic case of 'keep it simple, stupid'. I'm going with C. Periodic review. No need to overthink it for low-value items.

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Viola

10 months ago

A: Exactly, why make it more complicated than it needs to be?

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Avery

10 months ago

B: Yeah, it's simple and cost-efficient. No need for anything too complicated.

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Miriam

10 months ago

A: I agree, periodic review is definitely the way to go for low-value items.

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Tamesha

10 months ago

Order point could work too, but periodic review seems like the simplest option.

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Lynna

11 months ago

I think economic order quantity (EOQ) might be too complex for low-value items.

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Magdalene

11 months ago

I agree, periodic review is definitely the way to go for low-value items.

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Maryann

11 months ago

Hmm, I'm torn between B and D. MRP or EOQ... Decisions, decisions. Maybe I should just ask the professor to toss a coin for me.

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Dierdre

11 months ago

But wouldn't Periodic review be more suitable for low value items?

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Carmela

12 months ago

I agree with Xuan, EOQ takes into account the holding cost and ordering cost.

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Lenna

12 months ago

D. Economic order quantity (EOQ) is the way to go. It might be a bit more complicated, but it'll optimize your inventory costs in the long run.

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Tawna

11 months ago

D. Economic order quantity (EOQ) is the way to go. It might be a bit more complicated, but it'll optimize your inventory costs in the long run.

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Lenna

11 months ago

D) Economic order quantity (EOQ)

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Tarra

11 months ago

C) Periodic review

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Lourdes

11 months ago

B) Material requirements planning (MRP)

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Ruby

11 months ago

A) Order point

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Xuan

12 months ago

I think the most cost-efficient system would be Economic order quantity (EOQ).

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Theresia

12 months ago

I'd go with option C. Periodic review seems like the most cost-efficient for low-value items. You don't want to waste time and money on complex systems for cheap stuff, right?

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Natalie

11 months ago

I think Economic order quantity (EOQ) would be more suitable for high-value items.

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Natalie

11 months ago

I agree, periodic review is definitely the way to go for low-value items.

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