In the A-B-C Classification System, Items Which Account for About

question 46

Multiple Choice

In the A-B-C classification system, items which account for about 60 percent of the annual dollar value, but only about 10 to 15 percent of the items in inventory, would be classified as

• A)A items.
• B)B items.
• C)C items.
• D)A items plus B items.
• E)B items plus C items.

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Definitions:

Price Floors

Legally established minimum prices for goods or services, aimed at preventing prices from falling too low, often used in agriculture.

Market Failure

A situation where the allocation of goods and services by a free market is not efficient, often leading to negative externalities or a lack of public goods.

Competitive Market

A market structure characterized by a large number of buyers and sellers, free entry and exit, and a product for which each seller offers an identical product.

Deadweight Loss

A loss in economic efficiency that occurs when equilibrium for a good or service is not achieved or is not achievable.