Small Town used to be just that—a small town 6 miles from Large City. Over the years, the area between Small Town and Large City has developed, and now Small Town is part of the suburbs surrounding Large City
An auto insurer that operated in the area had a large increase in auto claims from Small Town insureds. The insurer did not adjust its rates, and this year will lose money because of claims attributable to higher population density. Which business rating objective did this insurer fail to meet?
A) simplicity
B) stability
C) responsiveness
D) encouragement of loss control
Answer: C
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Which of the following is the prescribed remedy when the bullwhip effect is caused by shortage gaming?
A) share demand information B) channel coordination C) increase capacity D) price stabilization E) allocate orders based on past demand
Direct intervention for currency valuation involves limiting the ability to exchange domestic currency for foreign currency
Indicate whether the statement is true or false.