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Imagine a two - firm supply chain that consists of a supplier and a retailer. The supplier has a marginal cost c = $ 4

Imagine a two-firm supply chain that consists of a supplier and a retailer. The supplier has a marginal cost c = $40 and a wholesale price w = $60. The retailer is looking to sell its product at p = $100; at this price point, demand over the lifespan of the product is distributed normally with mean 200 and standard deviation of 10.

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