Fill in the blank with an appropriate option below Pareto analysis is a statistical technique that i...........

Decision making and Interpersonal Skills Decision making

Fill in the blank with an appropriate option below. Pareto analysis is a statistical technique that is used in decision-making for the selection of the limited number of tasks that produce the most signifcant overall efect. It uses the concept based on identifying the top _______ of causes that need to be addressed in order to resolve ________ of the problems.

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Nabard grade-A, Previous year Memory Based Paper (2023)

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20%, 80%

80%, 20%

50%, 50%

30%, 70%

70%, 30%

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Explanation:

- Option 1: 20%, 80% - This is often emphasized in Pareto analysis. The principle states that 80% of effects come from 20% of causes. This is commonly known as the 80/20 rule or Pareto Principle.

- Option 2: 80%, 20% - It incorrectly flips the percentages. The principle focuses on the smaller percentage of causes yielding the larger percentage of effects.

- Option 3: 50%, 50% - This implies an equal distribution, which doesn't align with Pareto Principle's focus on imbalanced influence.

- Option 4: 30%, 70% - This option does not capture the typical Pareto emphasis on a clear minority of causes responsible for a majority of effects.

- Option 5: 70%, 30% - This is incorrect as it reverses the concept of a smaller cause having a larger effect.

Correct Answer: Option 1: 20%, 80%