INVENTORY Definition

INVENTORY for companies: includes raw materials, items available for sale or in the process of being made ready for sale (work in process) for securities: it is securities bought and held by a broker or dealer for resale. A firm that has a sustainable competitive advantage has an inventory and net earnings are rising on a corresponding basis. Inventories that spike up/down are indicative of competitive industries prone to boom/bust.

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COST EFFECTIVE is when a judgment is made that something is economical in terms of the goods or services received for the money spent.

PURCHASING POWER is the value of a particular monetary unit in terms of the amount of goods or services that can be purchased with it, i,e, the ability to purchase, generally measured by income.

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