Question

Which of the following would be negative feedback to a local car dealer from a systems theory?

A: finding that the inventory of unsold cars has increased over the last few months
B: coverage in the local paper about their employee of the month
C: receiving a shipment of new cars from the producer
D: sending out a shipment of used cars that were traded in

Answer 1

Negative feedback for a local car dealer in a systems theory context would be an increase in unsold inventory, as it indicates a potential issue such as decreased demand or pricing strategies that may lead to market disequilibrium.

Step-by-step explanation:

Which of the following would be negative feedback to a local car dealer from a systems theory perspective? The answer is A: finding that the inventory of unsold cars has increased over the last few months. This is an example of negative feedback because the increase in inventory indicates that the cars are not selling as expected, which could signal a problem that may require the dealer to adjust their strategy. This is contrasted with positive feedback, which aims to balance deficits, but in this case, the surplus of inventory is causing a negative impact. For instance, reduced sales could be due to market conditions such as decreased demand or increased competition, which in turn could be exacerbated by buyers assuming that a lower price indicates lower quality, thus potentially affecting the dealer's ability to reach an equilibrium price and quantity.