Question

"Pareto principle" relates to which of the following areas.

• A. Cash Management
• B. Inventory Management
• C. Budgeting
• D. Receivables Management

Hint:

Remember, the Pareto principle is often applied in inventory management to identify the most important items.

Answer 1

The Correct Option is B

The Pareto principle, also known as the 80/20 rule, is often applied to inventory management, where 20% of items contribute to 80% of the value or sales. This principle helps prioritize inventory management efforts.