The bullwhip effect:
A)occurs as orders are relayed from retailers to distributors to wholesalers to manufacturers.
B)results in increasing fluctuations at each step of the sequence.
C)increases the costs associated with inventory in the supply chain.
D)occurs because of distortions in information in the supply chain.
E)All of the above are true.

Question

Quizplus · Accepted Answer

The bullwhip effect occurs as orders are relayed from retailers to distributors to wholesalers to manufacturers and results in increasing fluctuations at each step of the sequence. This increase in variability leads to an increase in the costs associated with inventory in the supply chain. The root cause of the bullwhip effect is distortions in information in the supply chain.

The Bullwhip Effect