Suppose that a car dealer had an inventory of 150 cars on December 31, 2015, got 35 new cars shipped from the factory during 2016, and sold 20 cars to consumers during the year, making the dealer's inventory equal to 165 cars on December 31, 2016. What was the contribution of the car dealer to inventory investment for 2016?

Question

Quizplus · Accepted Answer

Inventory investment is the change in the level of inventory from the beginning to the end of a period. The dealer started with 150 cars, ended with 165 cars, so the change (or contribution to inventory investment) is 165 - 150 = 15 cars.

Suppose That a Car Dealer Had an Inventory of 150