Second-Degree Monopoly Wholesaler with Variable Ordering Costs
Ordering costs are usually considered as fixed costs. For the case of one seller and two identical buyers, we examine ordering charges that are proportional to the number of units ordered. We find that no extra profits will be generated, neither for the producer nor for the retailers. Thus, proportional ordering costs are not economically justified.
Volume (Year): 10 (2011)
Issue (Month): 1 (April)
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- Andrew J. Clark & Herbert Scarf, 1960.
"Optimal Policies for a Multi-Echelon Inventory Problem,"
INFORMS, vol. 6(4), pages 475-490, July.
- Andrew J. Clark & Herbert Scarf, 2004. "Optimal Policies for a Multi-Echelon Inventory Problem," Management Science, INFORMS, vol. 50(12_supple), pages 1782-1790, December.
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