The Information Value Applying to the Newsboy Model with the Cutoff Transaction Size

    Volume 38, Issue 3 (May 2010)

    ISSN: 0090-3973

    CODEN: JTEOAD

    Published Online: 8 December 2009

    Page Count: 6


    Tsai, Hui-Yin
    Dept. of Business Administration, Yuanpei Univ., Hsin-Chu,

    Lin, Chin-Tsai
    Dept. of Business Administration, Yuanpei Univ., Hsin-Chu,

    (Received 13 May 2009; accepted 24 October 2009)

    Abstract

    In this investigation, we adopt the perspective of a retailer and incorporate information flow between a retailer and customers. Meanwhile, the retailer can gain for the complete information about the state of customers’ demand from the exporter and pay them in order to make correct decisions and obtain more profits. Hence, precise expressions are derived for the expected total profit with incomplete and complete information of demand to measure the value of information. Moreover, we determine an optimal order-up-to level S and a cutoff transaction size q systematically. Finally, the numerical example is given to illustrate the result derived.


    Paper ID: JTE102493

    DOI: 10.1520/JTE102493

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    Author
    Title The Information Value Applying to the Newsboy Model with the Cutoff Transaction Size
    Symposium , 0000-00-00
    Committee F32