What Is the Bullwhip Effect

question 15

Multiple Choice

What is the bullwhip effect?

• A) Views all areas up and down the supply chain in real time
• B) Uses advanced mathematical algorithms to improve the flow and efficiency of the supply chain while reducing inventory
• C) Ensures supply chain cohesion by automating the different activities of the supply chain
• D) Occurs when distorted product-demand information ripples from one partner to the next throughout the supply chain

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Definitions:

Government Bonds

Securities issued by a government to finance its expenditures, repaid over a period.

Open Market

A marketplace with few restrictions on entry or trade, allowing goods and services to be bought and sold freely.

Bonds

Fixed-income investments representing a loan made by an investor to a borrower, often used by companies or governments to finance projects or operations.

Reserve Ratio

The fraction of deposits that a bank holds as reserves, either in its own vaults or at the central bank, affecting the bank's capacity to issue new loans.