Newsboy Model with Pricing

David Simchi-Levi
Operations Research Center
Newsboy Problem

c p

Image by MIT OpenCourseWare.

Price Depending Demand

i.e., demand decreases stochastically with price

Additive Demand

Additive Demand (continued)

Deterministic Demand

“Riskless
Riskless Price
Price” or “Deterministic
Deterministic Price

Price”

Multiplicative Demand

Multiplicative Demand (continued)

 Deterministic Demand

“Riskless Price” or “Deterministic Price”

MIT OpenCourseWare
http://ocw.mit.edu

ESD.273J / 1.270J Logistics and Supply Chain Management

Fall 2009

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