On the effect of demand randomness on inventory, pricing and profit

We consider a stocking-factor-elasticity approach for pricing newsvendor facing multiplicative demand uncertainty with lost sales. For a class of iso-elastic demand curves, we prove that optimal order quantity decreases in demand uncertainty for zero salvage value. This contrasts with fixed-price ne...

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Bibliographic Details
Main Authors: Chua, Geoffrey Bryan Ang, Liu, Yan
Other Authors: Nanyang Business School
Format: Article
Language:English
Published: 2015
Subjects:
Online Access:https://hdl.handle.net/10356/79324
http://hdl.handle.net/10220/38534
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Institution: Nanyang Technological University
Language: English