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Problem 5 (Supply Chain Management): Suppose you are a wholesaler for newspapers. Your cost is 15 cents/newspaper. You charge the newsvendor 90 cents/newspaper. Newsvendor
Problem 5 (Supply Chain Management): Suppose you are a wholesaler for newspapers. Your cost is 15 cents/newspaper. You charge the newsvendor 90 cents/newspaper. Newsvendor sells to customers at $1/newspaper. a. How many newspapers will the retailer purchase? What if the retailer and the wholesaler decide to maximize their total profit? b. Wholesaler wants to "induce" retailer to purchase more newspapers. Wholesaler agrees to "buy-back" unsold newspapers at price $0.8/newspaper. How many newspapers will the retailer purchase?
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