What lot-sizing technique generates planned orders in quantities equal to net requirements in each period?

What lot-sizing technique generates planned orders in quantities equal to net requirements in each period?

• A. Fixed-interval
• B. Lot-for-lot
• C. Economic order quantity
• D. Lot-size inventory method

Answer: (B)

This is about how different lot-sizing rules convert demand into order quantities. The rule that produces planned orders exactly equal to what is needed in each period—no more, no less—is called Lot-for-Lot. In MRP terms, for every period you take the net requirements (gross demand minus on-hand and scheduled receipts) and place a planned order that size. This keeps inventory tightly aligned with actual demand, minimizing carry costs and avoiding surplus inventory. Fixed-interval would place orders at fixed time gaps, with quantities that cover the interval’s demand, which isn’t necessarily equal to each period’s net requirement. Economic order quantity aims for a single, cost-minimizing lot size over time, not per-period net requirements. The lot-size inventory method describes a broader approach to determining order quantities, not the exact per-period matching of net requirements.

This is about how different lot-sizing rules convert demand into order quantities. The rule that produces planned orders exactly equal to what is needed in each period—no more, no less—is called Lot-for-Lot. In MRP terms, for every period you take the net requirements (gross demand minus on-hand and scheduled receipts) and place a planned order that size. This keeps inventory tightly aligned with actual demand, minimizing carry costs and avoiding surplus inventory.

Fixed-interval would place orders at fixed time gaps, with quantities that cover the interval’s demand, which isn’t necessarily equal to each period’s net requirement. Economic order quantity aims for a single, cost-minimizing lot size over time, not per-period net requirements. The lot-size inventory method describes a broader approach to determining order quantities, not the exact per-period matching of net requirements.