The ________ is a technique that divides inventory into three groups, according to dollar investment.
A) exponential smoothing technique
B) ABC system
C) EOQ model
D) LIFO model

Question

Quizplus · Accepted Answer

The ABC system is a technique that divides inventory into three groups (A, B, and C) based on their dollar investment. Group A typically represents high-value items with a lower frequency of demand, while Group C items represent low-value items with higher demand frequency. This allows companies to prioritize their inventory management efforts and allocate resources accordingly. The other options (exponential smoothing, EOQ model, and LIFO model) are not related to inventory classification based on dollar investment.

The ________ Is a Technique That Divides Inventory into Three