(Newsvendor with Forecasting) Suppose that demands are normally distributed

and that the newsvendor does not know µ and σ, but he estimates them in each period, as

described in Section 4.3.2.7, using moving averages and standard deviations with N = 5.

The observed demands in periods t − 10, . . . , t − 1 are 99, 87, 125, 106, 100, 107, 93, 114,

87, and 85. The cost parameters are h = 2 and p = 15. What is the optimal order quantity

for the newsvendor in period t?

Solution.pdf

Submit your documents and get free Plagiarism report

Your solution is just a click away! Get it Now

By creating an account, you agree to our terms & conditions

We don't post anything without your permission

Attach Files

Get it solved from our top experts within 48hrs!