Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Question
Given the following percentage costs of carrying inventory, calculate the annual carrying cost if the average inventory is $1 million. Capital costs are 10%, storage costs
are 6%, and risk costs are 9%.

Transcribed Image Text:100
20F
A
B
20
40
60
80
100
PERCENTAGE OF ITEMS
FIGURE 9.3 ABC curve: Percentage of value versus percentage of items.
PERCENTAGE OF VALUE
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