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23-12-2022
Business

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consider two products a and b that have identical cost, retail price and demand parameters and the same short selling season. the newsvendor model is used to manage inventory for both products. product a is to be discontinued at the end of the season this year, and the leftovers will be salvaged at 65% of the cost. product b will be re-offered next summer, so any leftovers this year can be carried over to the next year while incurring a holding cost on each leftover unit equal to 15% of the product's cost. how do the stocking quantities for these products compare?

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