A Company Distributes Products Through a Multitiered Distribution Network

question 394

Multiple Choice

A company distributes products through a multitiered distribution network. Recently there has been high demand variability for a mature product that had experienced stable demand for several years. The most appropriate way to address the variability of demand is to:

• A) extend forecast horizon.
• B) increase distribution safety stock targets.
• C) increase manufacturing throughput.
• D) increase demand visibility with all partners.

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Definitions:

Equilibrium Price

The price point at which the quantity of goods supplied equals the quantity demanded, resulting in market stability.

Market Price

The current price at which an asset or service can be bought or sold in a given market.

Equilibrium Price

The market price where the quantity of goods supplied is equal to the quantity of goods demanded.

Equilibrium Quantity

The quantity of goods or services that is supplied and demanded at the equilibrium price, where demand equals supply.