Inventory needs under a derived-demand inventory system are:

A) Primarily dependent upon the competitive demands placed on a firm's suppliers.
B) Based on the anticipated finished goods level of inventory.
C) Based on minimizing the cost of restocking inventory.
D) Held constant over time.
E) Determined by a kanban system.

Derived-Demand Inventory

Inventory levels that are based on the anticipated demand for finished goods, driving the demand for raw materials as well.

Anticipated Finished Goods

The forecasted amount of products that will be completed and ready for sale at the end of a production cycle.

Restocking Inventory

The process of replenishing goods or materials within a business to ensure sufficient supply for operation or sale.