Investment Under Demand Uncertainty: The Newsboy Problem Revisited
نویسندگان
چکیده
منابع مشابه
Investment Under Demand Uncertainty: The Newsboy Problem Revisited
In this article we study the effect of uncertainty on an entrepreneur who must choose the capacity of his business before knowing the demand for his product. The unit profit of operation is known with certainty, but there is no flexibility in our one-period framework. We show how the introduction of global uncertainty reduces the investment of the risk-neutral entrepreneur and, even more, that ...
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In this paper, we consider a newsvendor who is going to invest on dedicated or flexible capacity, our goal is to find the optimal investment policy to maximize total profit while the newsvendor faces uncertainty in lead time and demand simultaneously. As highlighted in literature, demand is stochastic, while lead time is constant. However, in reality lead time uncertainty decreases newsvendor's...
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ژورنال
عنوان ژورنال: The Geneva Papers on Risk and Insurance Theory
سال: 1996
ISSN: 0926-4957,1554-9658
DOI: 10.1007/bf00941937