Mean 32000 Max 65000

sd 11000
Price 24 cost 10.9
Order Qunatity 20000 21000 22000
Cumulative
Probability Demand Probability
0.0031930116 2000 0.003193011641354 -170000 -180900 -191800
0.0054567786 4000 0.002263766932704 -122000 -132900 -143800
0.0090482827 6000 0.003591504132788 -74000 -84900 -95800
0.0145614771 8000 0.005513194369347 -26000 -36900 -47800
0.0227501319 10000 0.008188654871987 22000 11100 200
0.034518174 12000 0.011768042049029 70000 59100 48200
0.0508817525 14000 0.016363578478421 118000 107100 96200
0.0728975705 16000 0.022015818000359 166000 155100 144200
0.1015574182 18000 0.028659847695578 214000 203100 192200
0.1376564433 20000 0.036099025089416 262000 251100 240200
0.1816510704 22000 0.043994627182468 262000 275100 288200
0.2335294509 24000 0.051878380414138 262000 275100 288200
0.2927204673 26000 0.059191016426877 262000 275100 288200
0.3580647844 28000 0.065344317143319 262000 275100 288200
0.4278627077 30000 0.069797923232253 262000 275100 288200
0.5 32000 0.072137292339964 262000 275100 288200
0.5721372923 34000 0.072137292339964 262000 275100 288200
0.6419352156 36000 0.069797923232253 262000 275100 288200
0.7072795327 38000 0.065344317143319 262000 275100 288200
0.7664705491 40000 0.059191016426877 262000 275100 288200
0.8183489296 42000 0.051878380414138 262000 275100 288200
0.8623435567 44000 0.043994627182468 262000 275100 288200
0.8984425818 46000 0.036099025089416 262000 275100 288200
0.9271024295 48000 0.028659847695578 262000 275100 288200
0.9491182475 50000 0.022015818000359 262000 275100 288200
0.965481826 52000 0.016363578478421 262000 275100 288200
0.9772498681 54000 0.011768042049029 262000 275100 288200
0.9854385229 56000 0.008188654871987 262000 275100 288200
0.9909517173 58000 0.005513194369347 262000 275100 288200
0.9945432214 60000 0.003591504132788 262000 275100 288200
0.9968069884 62000 0.002263766932704 262000 275100 288200
0.9981875928 64000 0.001380604448751 262000 275100 288200
0.9990022764 66000 0.000814683606315 262000 275100 288200
0.999467424 68000 0.000465147585002 262000 275100 288200
0.9997243894 70000 0.000256965356662 262000 275100 288200
246814.2894 256606.9 266399.6

Analytical
CR 0.545833333
Q 33266.55141

z 0.11
Loss Function 0.34635345
Expected loss 3809.887955
 23000 24000 25000 26000 27000 28000 29000 30000 31000 32000

-202700 -213600 -224500 -235400 -246300 -257200 -268100 -279000 -289900 -300800
-154700 -165600 -176500 -187400 -198300 -209200 -220100 -231000 -241900 -252800
-106700 -117600 -128500 -139400 -150300 -161200 -172100 -183000 -193900 -204800
-58700 -69600 -80500 -91400 -102300 -113200 -124100 -135000 -145900 -156800
-10700 -21600 -32500 -43400 -54300 -65200 -76100 -87000 -97900 -108800
37300 26400 15500 4600 -6300 -17200 -28100 -39000 -49900 -60800
85300 74400 63500 52600 41700 30800 19900 9000 -1900 -12800
133300 122400 111500 100600 89700 78800 67900 57000 46100 35200
181300 170400 159500 148600 137700 126800 115900 105000 94100 83200
229300 218400 207500 196600 185700 174800 163900 153000 142100 131200
277300 266400 255500 244600 233700 222800 211900 201000 190100 179200
301300 314400 303500 292600 281700 270800 259900 249000 238100 227200
301300 314400 327500 340600 329700 318800 307900 297000 286100 275200
301300 314400 327500 340600 353700 366800 355900 345000 334100 323200
301300 314400 327500 340600 353700 366800 379900 393000 382100 371200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
301300 314400 327500 340600 353700 366800 379900 393000 406100 419200
275136.3 283873.1 291364.8 298856.5 304927.6 310998.6 315501.5 320004.3 322832 325659.7
 33000 34000 35000 36000 37000 38000 39000 Order QunaExpected profit

20000 246814.3
-311700 -322600 -333500 -344400 -355300 -366200 -377100 21000 256606.9
-263700 -274600 -285500 -296400 -307300 -318200 -329100 22000 266399.6
-215700 -226600 -237500 -248400 -259300 -270200 -281100 23000 275136.3
-167700 -178600 -189500 -200400 -211300 -222200 -233100 24000 283873.1
-119700 -130600 -141500 -152400 -163300 -174200 -185100 25000 291364.8
-71700 -82600 -93500 -104400 -115300 -126200 -137100 26000 298856.5
-23700 -34600 -45500 -56400 -67300 -78200 -89100 27000 304927.6
24300 13400 2500 -8400 -19300 -30200 -41100 28000 310998.6
72300 61400 50500 39600 28700 17800 6900 29000 315501.5
120300 109400 98500 87600 76700 65800 54900 30000 320004.3
168300 157400 146500 135600 124700 113800 102900 31000 322832
216300 205400 194500 183600 172700 161800 150900 32000 325659.7
264300 253400 242500 231600 220700 209800 198900 33000 326756.1
312300 301400 290500 279600 268700 257800 246900 34000 327852.5
360300 349400 338500 327600 316700 305800 294900 35000 327217.6
408300 397400 386500 375600 364700 353800 342900 36000 326582.7
432300 445400 434500 423600 412700 401800 390900 37000 324272.6
432300 445400 458500 471600 460700 449800 438900 38000 321962.5
432300 445400 458500 471600 484700 497800 486900 39000 318084.2
432300 445400 458500 471600 484700 497800 510900
432300 445400 458500 471600 484700 497800 510900
432300 445400 458500 471600 484700 497800 510900
432300 445400 458500 471600 484700 497800 510900
432300 445400 458500 471600 484700 497800 510900
432300 445400 458500 471600 484700 497800 510900
432300 445400 458500 471600 484700 497800 510900
432300 445400 458500 471600 484700 497800 510900
432300 445400 458500 471600 484700 497800 510900
432300 445400 458500 471600 484700 497800 510900
432300 445400 458500 471600 484700 497800 510900
432300 445400 458500 471600 484700 497800 510900
432300 445400 458500 471600 484700 497800 510900
432300 445400 458500 471600 484700 497800 510900
432300 445400 458500 471600 484700 497800 510900
432300 445400 458500 471600 484700 497800 510900
326756.1 327852.47 327217.6 326582.7 324272.6 321962.5 318084.2
Expected profit

Expected profit
350000

300000

250000
Ordr Qunatity

200000

150000

100000

50000

0
15000 20000 25000 30000 35000 40000

Expected Profit
t

35000 40000 45000

fit
Fixed cost (F) 100000 Wholesale price (w) 80
Variable cost 35 Retail Price (p) 125
Q* 16000 Q* 16000
Demand ProbabilityRetailer Profit Manufacturer Profit Total Profit
8000 0.11 -120000 620000 500000
10000 0.11 90000 620000 710000
12000 0.275 300000 620000 920000
14000 0.225 510000 620000 1130000
16000 0.185 720000 620000 1340000
18000 0.095 720000 620000 1340000
Expected profit 395550 620000 1015550

Retailer Profit Manufacturer Profit Total Profit

Q=12000 470700 440000 910700
Q=16000 395550 620000 1015550
16% 41% 12%
What quantity maximise channel profit
 Salvage (g) 20

Centralised profit
500000
710000
920000
1130000
1340000
1340000
1015550

Dece
Cen
Fixed cost (F) 100000
Variable cost 35
Q* 16000
Demand Probability Retailer Profit
8000 0.11 273107.435794
10000 0.11 368695.038322
12000 0.275 464282.64085
14000 0.225 559870.243378
16000 0.185 655457.845906
18000 0.095 655457.845906
Expected profit 507775

Retailer share 50%

Manufacture share 50%
Wholesale price (w) 84.0338846308992 Salvage (g) 20
Retail Price (p) 125 Buyback 77.21

Manufacturer Profit Total Profit

226892.564205994 500000
341304.961678093 710000
455717.359150191 920000
570129.756622289 1130000
684542.154094387 1340000
684542.154094387 1340000
507774.999999995 1015550
Fixed cost (F) 100000 Wholesale price (w) 26.827685895
Variable cost 35 Retail Price (p) 125
Q* 16000
Demand ProbabilityRetailer Profit Manufacturer Profit Total Profit
8000 0.11 273107.435793995 226892.564206005 500000
10000 0.11 368695.038321893 341304.961678107 710000
12000 0.275 464282.640849791 455717.359150209 920000
14000 0.225 559870.24337769 570129.75662231 1130000
16000 0.185 655457.845905588 684542.154094412 1340000
18000 0.095 655457.845905588 684542.154094412 1340000
Expected profit 507774.999999985 507775.000000015 1015550

Retailer Share 0.499999999999986

Manufcaturer share 0.500000000000015
Salvage (g) 20
Revenue share 0.54235