In a Supply Chain with the Sequence of Factory, Distributor

question 266

Multiple Choice

In a supply chain with the sequence of factory, distributor, wholesaler, retailer, which entity is most likely to experience the greatest variability in demand resulting from the bullwhip effect?

• A) Factory
• B) Distributor
• C) Wholesaler
• D) Retailer

---

Definitions:

Marginal Product

is the additional output that results from using one more unit of a particular input, holding other inputs constant.

Average Product

The output produced per unit of input, calculated by dividing total output by the number of units of input.

Law Of Diminishing Marginal Returns

An economic principle stating that as investment in a particular area increases, the rate of profit from that investment, after a certain point, cannot continue to increase if other variables remain at a constant.

Total Output

The overall quantity of goods and services produced in an economy within a specific time frame.