Question

Small changes in consumer demand can result in large variations in orders placed because of the:_______

Answer 1

Small changes in consumer demand can result in large variations in orders placed because of the Bullwhip Effect. Thus the correct answer is D.

What is a consumer?

The consumer is referred as an end user of any product or service. He is the person who utilizes or takes the benefit of the products purchased. The person who buys a product is called a customer.

Demand estimations result in ineffective supply chains due to the bullwhip effect which is a characteristic of distribution channels. As one moves higher up the supply chain, it informs of increasing inventory variations in reaction to variations in consumer demand.

Therefore, option D Bullwhip effect is appropriate.

Learn more about the Bullwhip effect, here:

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The complete question is attached below-

Small changes in consumer demand can result in large variations in orders placed because of the:

A) Supply chain

B) Safety stock requirement

C) Lead time effect

D) Bullwhip effect

E) FCFS scheduling