If You Burn Your Trash in the Backyard in Spite

question 242

Multiple Choice

If you burn your trash in the backyard in spite of regulations against it, then you are

• A)acting economically irrationally and creating a social cost.
• B)avoiding the private costs associated with disposing your trash some other way and creating a social cost.
• C)acting rationally and creating a positive externality.
• D)saving landfill space and creating a social benefit.

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Definitions:

Bullwhip Effect

A phenomenon where small fluctuations in demand at the retail level significantly amplify as they move back through the supply chain towards manufacturers.

Variance of Orders

The statistical measure that represents the variability or spread in the number of orders received over a certain period of time.

Bullwhip Measure

A phenomenon in supply chain management where small changes in demand at the retail level cause increasingly larger changes in demand at the wholesale, distributor, and factory levels.

Demand Variance

The difference between the forecasted and actual demand for products or services, affecting inventory and production planning.