Question

If the variance of orders of a manufacturer equals 800, and the variance of orders of its supplier equals 750, what is happening at this part of the supply chain?

A.The supplier is providing a dampening (anti-bullwhip) effect.
B. The bullwhip effect is present.
C. Both amplification and smoothing are present.
D. Neither amplification nor smoothing is present.
E. The bullwhip measure for the supplier equals 1.067

Answer 1

The correct answer is option A

A.The supplier is providing a dampening (anti-bullwhip) effect.