The ABC analysis makes use of the:
A)social audit.
B)expectancy theory.
C)iceberg principle.
D)80/20 rule.
E)equity theory.

Question

Quizplus · Accepted Answer

The ABC analysis, also known as the Pareto analysis, is based on the 80/20 rule. This rule states that 80% of the effects come from 20% of the causes. In inventory management, for example, it means that a large portion of the inventory value (the top 20%) is held by a small portion of the inventory items (the top 20%). This analysis helps managers to prioritize their efforts and resources on the most important items, which can lead to significant improvements in efficiency and profitability.

The ABC Analysis Makes Use of The