The fluctuation in the supply upstream in a supply chain generated by a small change in demand downstream in the supply chain is known as:
A) Forecast error
B) Bullwhip effect
C) Break-even point
D) Demand variation

Question

Quizplus · Accepted Answer

The bullwhip effect is a phenomenon in supply chain management where small changes in demand downstream in the supply chain can cause significant fluctuations in supply upstream. This can lead to inefficiencies, excess inventory, and increased costs. Forecast error and demand variation are related to the bullwhip effect but do not capture the full extent of the problem, while break-even point is unrelated to supply chain fluctuations.

The Fluctuation in the Supply Upstream in a Supply Chain