The supplier Zamatia agrees to buy back any leftover inventory at the price of $40 per unit, which is higher than the salvage value of $25. • In this case, the retailer UV earns 115-75 = $40 for each unit sold, and loses 75-40 = $35 for each unit of unsold. This is the information you need to apply newsvendor model. • Zamatia earns 75-35 = $40 for each unit sold and earns 75-35-40+25 = $25 for each unit unsold.

Answer rating: 100% (QA)

Based on the provided information we can apply the newsvendor model to analyze the decisionmaking process for the retailer UV and the supplier Zamatia ... View the full answer