New Free SEBI Legal Descriptive Answers Workshop with Vidhika Ma'am
Register

Question

The level at which a fresh order should be placed for the replenishment of the stock is known as ______.

A Minimum stock level Correct Answer Incorrect Answer
B Danger level Correct Answer Incorrect Answer
C Re-order stock level Correct Answer Incorrect Answer
D Average stock level Correct Answer Incorrect Answer

Solution

The level at which a fresh order should be placed for the replenishment of the stock is known as the "Re-order stock level" or "Reorder Point." The Reorder Point is the inventory level at which a new order should be placed with the supplier to avoid stockouts or shortages. When the stock level falls to or below the reorder point, it triggers a signal for the purchase department to place a new order to replenish the stock and maintain sufficient inventory levels to meet demand during the lead time (time taken for the new order to arrive).

Practice Next
×
×