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Supply Chain Management Professional (SCMP) · Question

ABC analysis in inventory classifies items by:

ABC ranks items by annual usage value (80/20).

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Question: ABC analysis in inventory classifies items by:

Answer options:

  • Alphabetical name ✅ Annual usage value (Pareto)
  • Supplier location
  • Lead time only

Correct answer: Annual usage value (Pareto)

Explanation: ABC ranks items by annual usage value (80/20).

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