Small changes in consumer demand can result in large variations in orders placed because of bullwhip effect. The correct option is b.
The bullwhip effect (also known as the Forrester effect) is a demand distortion.
It goes upstream in the supply chain from the retailer to the wholesaler and manufacturer due to order volatility that is greater than sales variance.
Because the involved parties need to safeguard themselves against demand changes, the bullwhip effect generally results in excessive inventory investments across the supply chain.
Thus, the correct option is b, bullwhip effect.
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