Question 11 - Periodic review systems (P-systems) require a precise counting of inventory only at specific times and includes all of the following except:

	This type of system is useful in situations where inventory is managed by an outside firm or where there is a desire to combine orders to save on transportation costs.
	Even with computerized inventory systems, we still must physically check how much inventory is actually available because customers often will misplace, shoplift, or eat inventory, or employees within the company may make data-entry mistakes.
	Vendor-managed inventory (VMI) occurs when vendors monitor sales at the retailer and replenish inventories when supplies are low.
	P-systems have a fixed time period, but the order quantity may vary substantially from period to period. The system must adjust the amount ordered to compensate for variability in demand (unlike a continuous review system, which adjusts the timing of orders).
	Determining the period and order quantity does not include inventory levels that will cover expected demand during the protection interval plus enough safety stock to provide the desired cycle- service level.