As the standard deviation of the forecast error increases,the expected profit decreases.

Name: As the standard deviation of the forecast error increases,the expected profit decreases.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

A higher standard deviation of the forecast error indicates that the actual demand is more likely to deviate from the forecasted demand, which can lead to lower profits due to overstocking or under-stocking. Therefore, as the standard deviation of the forecast error increases, the expected profit decreases.

As the Standard Deviation of the Forecast Error Increases,the Expected