Because of Changing Economic Conditions, It Is Difficult for Companies

question 30

True/False

Because of changing economic conditions, it is difficult for companies such as Dun & Bradstreet to devise models predicting payment problems and the probability of bankruptcy 12 months in the future.

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Definitions:

Smoothing

A technique used to remove variability or fluctuations in data or a process, often to reveal underlying trends.

Bullwhip Effect

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

Shortage Gaming

Strategic behavior by participants in a supply chain who intentionally reduce their demand forecasts when they anticipate a shortage, in order to receive more stock than they would otherwise.

Demand Information

Data regarding the amount and timing of desired goods or services by the market or specific customers, crucial for supply chain and production planning.