One Effective Method to Reduce the Bullwhip Effect in a Supply

question 5

Multiple Choice

One effective method to reduce the bullwhip effect in a supply chain is to replace inventory with:

• A) Information
• B) Outsourcing
• C) TOFC service
• D) Transportation

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Definitions:

Put Option

A financial contract giving the holder the right, but not the obligation, to sell a specified amount of an underlying asset at a predetermined price within a set time frame.

Put Premium

The cost associated with acquiring a put option, allowing the holder to sell an asset at a stipulated price within a specific timeframe, offering protection against asset depreciation.

Put Options

Financial contracts granting the holder the right to sell an asset at a predetermined price before a specified date.

Call Options

Financial contracts giving the buyer the right, but not the obligation, to buy an asset at a specified price within a specific time frame.