Final answer:
A supply manager makes both strategic and operational decisions. Price floors and ceilings do not shift the demand or supply curves but set legal price limits, with floors potentially leading to surpluses and ceilings potentially leading to shortages. These can be illustrated on a supply and demand diagram.
Step-by-step explanation:
In the context of supply management, a supply manager is generally responsible for making both strategic and operational decisions. This includes long-term decisions about supplier relationships, investment in technology, and product development, as well as day-to-day decisions concerning inventory levels, purchasing, and logistics. Therefore, the correct answer to the kind of decisions a typical supply manager makes would be c. both a and b.
Regarding economic concepts such as price floors and price ceilings, it is important to understand these do not shift the supply or demand curve; rather, they set legal limits on how low or high a price can be charged. A price floor set c. substantially above the equilibrium price or d. slightly above the equilibrium price are both scenarios in which the floor is above the market-clearing level, leading to potential surpluses. A price ceiling, on the other hand, is a maximum price, and it represents a different concept in market regulation. When asking whether a price ceiling will usually shift a. demand, b. supply, c. both, or d. neither, the answer is d. neither. Price ceilings create a legally-enforced maximum price but do not move the supply or demand curves themselves.
The impact of these regulations can be illustrated on a supply and demand diagram, where the price floor or ceiling would be represented by a horizontal line at the set price level, affecting the quantities supplied and demanded but not shifting the underlying curves.