Suppose that in month 1, both the retailer and the wholesaler in a supply chain ordered 20,000 units. Then in month 2, the retailer decreases its order size by 1000 units. If the wholesaler then decreases its order size in month 2 by 700 units, which of the following is true?

Question

Quizplus · Accepted Answer

The wholesaler is providing a dampening (anti-bullwhip) effect by decreasing its order size by a smaller amount than the retailer. This helps to reduce the amplification of demand fluctuations up the supply chain, resulting in a more stable and predictable supply chain. The bullwhip measure cannot be determined based on the information given.

Suppose That in Month 1, Both the Retailer and the Wholesaler