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qwelly [4]
3 years ago
6

La Belle Inc. introduced a new line of accessories for teenage girls the last season. Following its immense popularity with the

targeted group, the company anticipated high sales in the current season and ordered raw materials accordingly. . However, the success of the new line turned out to be a fad as the teens soon turned to other products offered by competing brands and La Belle's sales declined. This forecasting error caused a huge discrepancy in the amount of raw materials they needed and the amount of inventory they had already piled up in anticipation of good sales. This is an example of ________.
Business
1 answer:
ANTONII [103]3 years ago
8 0

Answer:

The bull whip effect

Explanation:

The bull whip effect is the fluctuations in inventories or asset as a result of demand changes as you move up in the supply chain. This demand distortion travels in an upward direction in the supply chain from the retailer through to the wholesaler and manufacturer due to the fluctuations in orders.

A method of reducing this effect is through establishing effective communications between the suppliers and customers so that the reason for the demand distortion can be communicated between parties.

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Victorinox is the name of the company that manufactures Swiss army knives. The _____ channel the company utilizes to get its kni
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The statement made by Lynn Turner, former SEC chief accountant, "Are the auditors going to serve management, or are they going t
OleMash [197]

Answer:

B. Conflict between professionalism and commercialism

Explanation:

The conflict between professionalism and commercialism speaks to the debate on satisfying the management of an organisation as an auditor in order to meet economic situations and the need to be professionally independent of management in order to make a true and fair statement of the state of the organisation available to the shareholders as well as potential investors and the general public.

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This represents the conflict expressed by Lynn Turner.

4 0
3 years ago
Suppose that a monopoly firm finds that its MR is $56 for the first unit sold each day, $55 for the second unit sold each day, $
OlgaM077 [116]

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Explanation:

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6 0
3 years ago
Suppose Sam would like to use $6,000 of his savings to make a financial investment. One way of making a financial investment is
grin007 [14]

Answer:

The correct options are option C and Option D.

Explanation:

Lets look at each option in turn and evaluate whether they are correct or incorrect

Option A: Incorrect. This can be understood by thinking in terms of the classic demand and supply of a given item. If the company issues more shares, there will be a greater amount of shares in the market for a potential investor to buy. This additional supply of shares will put a downward pressure on the price of the shares which will cause the share price to decrease.

Option B: Incorrect. When a company issues shares to raise money, it is known as equity finance. By doing so, the company is increasing its capital which is recorded in the balance sheet under the heading of "share capital". Another statement that will be impacted is the cash flow statement under the heading of cash flow from financing activity. The income statement will not be impacted. If Sam purchases shares from another investor, the company's statements will not be impacted.

Option C: Correct. Expectations of a recession that reduce corporate profits for make investors expect a lower return on investment if they invest in a corporation's shares. This will dampen the demand, thereby decreasing the price.

Option D: Correct. An investor measures the opportunity cost of an investment by generally comparing it to the risk free return that they can get on US bonds. So the investor can alternatively invest in US govt instruments.

Option E: Incorrect. A bond maturing 30 years from now will carry a DIFFERENT interest rate due to the varying tenor. The tenor of a bond affects the risk profile of an investment in the bond which makes bonds of differing maturities offer different returns in line with expectations concerning economic performance.

7 0
4 years ago
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