Risk tolerance and a retailer ’ s pricing and ordering policies within a newsvendor framework

@inproceedings{Arcelus2015RiskTA,
  title={Risk tolerance and a retailer ’ s pricing and ordering policies within a newsvendor framework},
  author={Francisco J. Arcelus and Satyendra Kumar and Gopalan Srinivasan},
  year={2015}
}
This paper evaluates the pricing and ordering policies of a retailer, facing a price-dependent stochastic demand, within a newsvendor framework, under different degrees of risk tolerance and under a variety of optimizing objectives. These are (i) maximizing expected profit, for a retailer who may be risk-seeker, riskaverse or risk neutral; (ii) deriving a maximin strategy of maximizing a minimum guaranteed profit and (iii) modeling the probability of exceeding a target profit, as a constraint… CONTINUE READING