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CIPS Exam L4M7 Topic 6 Question 20 Discussion

Actual exam question for CIPS's L4M7 exam

Question #: 20
Topic #: 6

[All L4M7 Questions]

The size of order that minimises the total cost of acquiring and holding stock is known as...

AOrder quantity

BEconomic Order Quantity

CThe correct quantity

DAverage stock

Show Suggested Answer

Suggested Answer: C

For single items, an extra investment in inventory (higher levels of safety stock) will always in-crease customer service levels. Conversely, higher service levels imply larger quantities of safety stocks and an increased investment in inventory. (Procurement and Supply Chain Management - 9th Edition)

LO 2, AC 2.2

by Van at Aug 04, 2023, 02:39 PM

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Marvel

2 months ago

Wait, is there a trick question here? What if the answer is actually the amount that maximizes my snack budget?

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Larae

21 minutes ago

D) Average stock

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Brittani

11 days ago

C) The correct quantity

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Kimberely

15 days ago

B) Economic Order Quantity

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Jarod

21 days ago

A) Order quantity

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Pansy

28 days ago

D) Average stock

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Lea

1 months ago

C) The correct quantity

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Carlene

1 months ago

B) Economic Order Quantity

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Felicia

1 months ago

A) Order quantity

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Delmy

2 months ago

Haha, I almost went with D) Average stock. Sounds like something my professor would trick us with!

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Bernadine

2 months ago

Hmm, I was stuck between B) and D) Average stock. Glad I double-checked the definitions!

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Shawana

1 months ago

B) Economic Order Quantity

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Douglass

1 months ago

A) Order quantity

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Karima

2 months ago

I thought it was C) The correct quantity, but I guess B) is the more formal term.

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Cathrine

28 days ago

Yes, that's correct. B) Economic Order Quantity is the optimal order size.

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Corrinne

1 months ago

Oh, I see. So B) is the formal term for it.

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Emilio

1 months ago

Actually, it's B) Economic Order Quantity that minimises total cost.

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Phyliss

2 months ago

I always thought it was C) The correct quantity too.

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Kenny

2 months ago

I'm not sure, but I think it's A) Order quantity.

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Nettie

2 months ago

B) Economic Order Quantity, of course! That's the textbook answer.

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Raelene

2 months ago

I agree with Veda, because EOQ helps in minimizing total cost.

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Veda

2 months ago

I think the answer is B) Economic Order Quantity.

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