Situations Where Demand Information Is Distorted as It Moves Between

question 37

Multiple Choice

Situations where demand information is distorted as it moves between different stages of the supply chain,leading to increased variability in orders within the supply chain are referred to as

• A)incentive obstacles.
• B)information processing obstacles.
• C)operational obstacles.
• D)behavioral obstacles.

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Definitions:

Marginal Cost

The additional cost incurred from making one more unit of a good or service.

Optimal-output

The level of production that maximizes a firm's profit, where marginal cost equals marginal revenue.

Break-even

The point at which cost or expenses and revenue are equal, resulting in neither profit nor loss.

Long-run Equilibrium

A state in which all factors of production and costs are variable, and firms are making neither excess profits nor losses.