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Give typed solution and full explanation QUESTION 3: Suppose that HQE sells a single kind of cutting edge LCD television to local electronics boutique Deluxe
Give typed solution and full explanation
QUESTION 3: Suppose that HQE sells a single kind of cutting edge LCD television to local electronics boutique Deluxe Capacitors (DC). Demand for this television depends on price, such that annual demand is 300,000 600p when DC sets a price to its customers of $17 per television. Each television costs HQE $400 to produce, and DC pays $CR to HQE for each television it purchases. You may ignore holding and ordering costs in this problem. (a) Suppose that the supply chain participants (HQE and DC) do not coordinate. Determine the optimal values of p and CR that individually maximize prots to DC and HQE. What is the prot to each supply chain participant when the prices are set this way? (b) Suppose that the supply chain participants (HQE and DC) agree to coordinate their efforts to maximize supply chain prot. Determine the optimal value of 17 that maximizes prot to the entire supply chain. What is the total prot to the entire supply chain when customer price is set this way? (c) Suppose that HQE would like to offer a volume-based discount to DC that will achieve the coordinated optimum sales quantity. Develop a simple volume-based discount that will achieve this, and explain the conditions that must be satised for this discount to be more appealing to both HQE and DC than operating in an uncoordinated fashionStep by Step Solution
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