Question: Answer True or False to the following statements. If False, please correct it. [8 pts] a) If the understocking and overstocking costs per unit in

 Answer "True" or "False" to the following statements. If False, please

Answer "True" or "False" to the following statements. If False, please correct it. [8 pts] a) If the understocking and overstocking costs per unit in the newsvendor problem both double, then the optimal quantity will not change. [2 pts] b) All else equal, a larger understocking cost per unit leads to a larger optimal newsvendor order quantity. [2 pts] c) When the demand variability increases, the optimal newsvendor order quantity must increase as well. [2 pts] d) If the shadow price is positive, then the left hand side must be equal to the right hand side at the corresponding constraint. [ 2pts]

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