What does the Fixed-order quantity (FOQ) method in MRP involve?

The Fixed-order quantity (FOQ) method in Material Requirements Planning (MRP) involves maintaining a constant order quantity for inventory replenishment. This approach ensures that whenever stock levels reach a predetermined reorder point, a specific, consistent amount of inventory is ordered to replenish the stock.

This method is beneficial because it simplifies the ordering process and helps in managing inventory levels effectively, as the organization can predict its inventory needs consistently. Utilizing a fixed order quantity reduces variability in ordering practices, allowing for predictable planning and optimization of storage, handling, and associated costs.

In contrast, options that suggest an order quantity that varies with demand or ties the order quantity to seasonal forecasts introduce variability and uncertainty into inventory management, which could complicate operational efficiency. The idea of a minimum quantity threshold refers to safety stock practices rather than a fixed ordering quantity, which doesn't directly align with the FOQ concept. Hence, the essence of the FOQ lies in its stability and predictability, represented by the correct answer.