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A positive flow of intended inventory investment occurs when a firm expects that sales will be high enough that the current level of inventories on hand may be insufficient—perhaps because in the presence of very short-term fluctuations in the timing of customer purchases, there is a risk of temporarily being unable to supply the product when a customer demands it.
In macroeconomics, investment "consists of the additions to the nation's capital stock of buildings, equipment, software, and inventories during a year" [1] or, alternatively, investment spending — "spending on productive physical capital such as machinery and construction of buildings, and on changes to inventories — as part of total spending" on goods and services per year.
Economics, business, accounting, and related fields often distinguish between quantities that are stocks and those that are flows. These differ in their units of measurement . A stock is measured at one specific time, and represents a quantity existing at that point in time (say, December 31, 2004), which may have accumulated in the past.
In business, Gross Margin Return on Inventory Investment (GMROII, also GMROI) [1] is a ratio which expresses a seller's return on each unit of currency spent on inventory.It is one way to determine how profitable the seller's inventory is, and describes the relationship between the profit earned from total sales, and the amount invested in the inventory sold.
The Kitchin cycle is a short business cycle of about 40 months, identified in the 1920s by Joseph Kitchin. [1]This cycle is believed to be accounted for by time lags in information movement, affecting the decision making of commercial firms.
Inventory management also involves risk which varies depending upon a firm's position in the distribution channel. Some typical measures of inventory exposure [definition needed] are width of commitment [definition needed], time of duration [definition needed] and depth [definition needed]. [20]
Not the highest investment returns. CDs are a safe way to steadily earn interest, but you stand to earn more over the long term through stocks, bonds or securities. And by locking your money in a ...
In economics, net investment is spending which increases the availability of fixed capital goods or means of production and goods inventories.It is the total spending on newly produced physical capital (fixed investment) and on inventories (inventory investment)—that is, gross investment—minus replacement investment, which simply replaces depreciated capital goods.