What Is the Bullwhip Effect and How Does It Occur

question 39

Essay

What is the bullwhip effect and how does it occur?

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Definitions:

Outcome Expectancy

An individual's belief about the likelihood that a specific behavior or action will lead to a particular outcome.

Optimistic Bias

The tendency to believe that one is less likely to experience negative events and more likely to experience positive events compared to others.

Pessimistic Bias

The tendency to overestimate the likelihood of negative outcomes or events happening in the future.

Balanced View

An approach or perspective that fairly considers all relevant aspects of an issue, avoiding extremes in judgment or opinion.