We claimed that the critical fractile formula, Equation

(12.8), is appropriate because the optimal Q should satisfy cunder (1  F(Q))  cover F(Q), that is, the cost of understocking times the probability of understocking should equal the cost of overstocking times the probability of overstocking. Assume that Q satisfies this equation [which is equivalent to Equation (12.8)].

Use a probability argument to show why Q  1 and Q1 are both worse than Q in terms of expected cost.