A supplier supplies a product at a unit cost of $15. The retailer acts as a newsvendor and pays a wholesale price of $30 to the supplier for each unit and sells the product to the market at a selling price $50 per unit. Excess inventory is sold to a secondary market at $5 per unit. The retailer faces discrete customer demand: 100 and 200 with equal probability. If the retailer enters a buy-back contract with the supplier. What is the buy-back price so that the supply chain can achieve the same performance as in an integrated supply chain (by rounding the result to the nearest integer)? 12 20 24 All of the above Answer:

A supplier supplies a product at a unit cost of $15. The retailer acts as a newsvendor and pays a wholesale price of $30 to the supplier for each unit and sells the product to the market at a selling price $50 per unit. Excess inventory is sold to a secondary market at $5 per unit. The retailer faces discrete customer demand: 100 and 200 with equal probability. If the retailer enters a buy-back contract with the supplier. What is the buy-back price so that the supply chain can achieve the same performance as in an integrated supply chain (by rounding the result to the nearest integer)? 12 20 24 All of the above Answer:

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter17: Making Decisions With Uncertainty

Section: Chapter Questions

Problem 17.2IP

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