Question: ABC analysis is based upon the principle that: all items in inventory must be monitored very closely an item is critical if its demand is

ABC analysis is based upon the principle that:

  1. all items in inventory must be monitored very closely
  2. an item is critical if its demand is higher than that of the other items in stock
  3. the safety stock (in terms of volume) should be higher for C items than for B items
  4. there are usually a few critical items, and many items which are less critical
  5. an item is critical if its price per unit is the highest compared to the other items in stock

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