Aggregation Reduces the Standard Deviation of Demand

question 56

Multiple Choice

Aggregation reduces the standard deviation of demand

• A) only if demand across the regions being aggregated is perfectly positively correlated.
• B) only if demand across the regions being aggregated is not perfectly positively correlated.
• C) even if demand across the regions being aggregated is not perfectly positively correlated.
• D) whenever demand across the regions being aggregated is not perfectly positively correlated.

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Definitions:

Memory Process

Memory Process involves the phases of encoding, storage, and retrieval of information, crucial for learning and recalling past experiences.

Information Retained

The amount or portion of learned material that an individual can recall or use over time.

Serial Position Effect

a phenomenon in memory that suggests people have a higher tendency to recall the first (primacy effect) and last (recency effect) items in a series.

Waiter

A server or person who works in a restaurant or establishment, attending to customers by taking orders and serving food and beverages.