Financing newsvendor inventory

Maqbool Dada, Qiaohai Hu

Research output: Contribution to journalArticlepeer-review

Abstract

If the cost of borrowing is not too high, the capital-constrained newsvendor borrows funds to procure an amount that is less than would be ideal. The lender charges an interest rate that decreases in the newsvendor's equity. Furthermore, we derived a non-linear loan schedule that coordinates the channel.

Original languageEnglish (US)
Pages (from-to)569-573
Number of pages5
JournalOperations Research Letters
Volume36
Issue number5
DOIs
StatePublished - Sep 1 2008
Externally publishedYes

Keywords

  • Capital-constrained coordination
  • Newsvendor
  • Stochastic inventory

ASJC Scopus subject areas

  • Software
  • Management Science and Operations Research
  • Industrial and Manufacturing Engineering
  • Applied Mathematics

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