For each event, explain whether the initial effect is a change in planned investment spending or a change in unplanned inventory investment, and indicate the direction of the change.

A. an unexpected increase in consumer spending
B. a sharp rise in the interest rate
C. a sharp increase in the economy's growth rate of real GDP
D. an unanticipated fall in sales

A: An unexpected increase in consumer spending results in decreased inventories of those who produce the goods.

B: An increase in the interest rate is equal to an increase in borrowing costs, therefore, those producers who wish to invest will have fewer viable projects since the cost of obtaining capital will be higher.

C: A sharp increase in the economy's growth rate of real GDP has the consequence that producers increase their production capacity and have a higher investment expense.

D: an unanticipated fall in sales causes producer inventories to grow as they sell less, leading to unplanned excess inventories.

whole quiz

1. the sum of all activities involved in getting high-quality products into the marketplace

2.operations

3. the principle of looking at the supply chain as a whole in order to improve the overall flow through the system.

4. produced; performed

5. activities producing tangible products, such as radios, newspapers, buses, and textbooks.

6. activities producing intangible and tangible products, such as entertainment, transportation, and education.

7.   customer focus

8. analyzing a competitor's products to identify desirable improvements

9. the systematic direction and control of the processes that transform resources into finished projects that create value for and provide benefits to consumers.

10. operation management.

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answer; private store;