Rationing schemes that allocate limited production in proportion to the orders placed by retailers
A) result in a game in which retailers try to increase the size of their orders to increase the amount supplied to them.
B) lead to a magnification of the bullwhip effect.
C) lead to the manufacturer being left with a surplus of product and capacity.
D) all of the above
E) B and C only

Question

Quizplus · Accepted Answer

Rationing schemes often cause retailers to inflate their orders to secure more stock, leading to the bullwhip effect and potential surplus for manufacturers.

Rationing Schemes That Allocate Limited Production in Proportion to the Orders