MB-920 Describe Dynamics 365 Supply Chain Management Practice Question
A company uses Dynamics 365 Supply Chain Management and wants to implement a process where suppliers can monitor inventory levels and automatically replenish stock. Which feature should they enable?
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Vendor-managed inventory (VMI)
Vendor-managed inventory (VMI) allows suppliers to monitor inventory levels and automatically replenish stock, which matches the requirement. Option A (Consignment inventory) is incorrect because it is about ownership, not supplier-managed replenishment. Option B (Purchase requisition) is an internal request, not supplier-facing. Option C (Blanket purchase orders) are long-term agreements but do not enable automatic replenishment by the supplier.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
Consignment inventory
Why it's wrong here
Consignment inventory is about ownership where the supplier retains ownership until use, not about automatic replenishment.
- ✗
Purchase requisition
Why it's wrong here
Purchase requisition is an internal document used to request purchases, not for supplier-managed inventory.
- ✗
Blanket purchase orders
Why it's wrong here
Blanket purchase orders are long-term agreements for pricing and quantities, but they do not allow suppliers to monitor and replenish stock automatically.
- ✓
Vendor-managed inventory (VMI)
Why this is correct
Vendor-managed inventory (VMI) allows the supplier to monitor inventory levels and automatically replenish stock, meeting the requirement.
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