The logic used to determine which filter items that will be hidden/disabled is based on the selections in all other dynamic filters. The sketch below explains the used logic.
Here we see an example of how the Dynamic filtering logic works. In this example Country, City and Segment filters have been set to use the Dynamic filtering logic, the Media type filter is not using the Dynamic filter logic. 


A selected filter that becomes disabled due to a selection in another filter will be shown in disabled (or hidden) but still selected style so when the filter options are enabled again (due to a selection in another filter) it will be selected by default, as it was before it was disabled or hidden.


The performance of the Dynamic Filtering function, the time it takes to calculate available filter options and hide/disable those, are affected by both the data volume and the number of filters options. The total number of filter options has the biggest impact on the performance while the data volume is less critical. For best performance use fewer filters and avoid having filters with large numbers of options. The end user’s browser, hardware, and internet connection bandwidth and latency will also be a factor in the perceived speed of dynamic filter performance.