Look at Solved Problem S$11\mathrm{.}2$ in the $12$th edition of Heizer and Render. It covers a supply chain consisting of Michael's Metals and his gear supplier.

The data is repeated here for convenience.

Week

Demand seen by Michael $($gears Michael sold$)$

Orders placed by Michael to his gear supplier

$1$

$140$

$140$

$2$

$230$

$250$

$3$

$100$

$90$

$4$

$175$

$190$

$5$

$165$

$140$

$6$

$220$

$240$

$7$

$200$

$190($originally shown incorrectly as $290--$use $190)$

$8$

$178$

$168$

For the following question, round your answer to two decimal places:

What is the bullwhip effect? $($Hint: use your variance calculations$).$

$1\mathrm{.}59$

What does this bullwhip measure mean?

$1-$ Michael is helping calm the bullwhip effect down and reduce variability in his supply chain

$2-$ Michael is having no effect on the bullwhip effect in his supply chain

$3-$ Michael is contributing to the bullwhip effect in his supply chain