Decision Sciences Journal
Volume 27, Number 3
Summer 1996
The Newsboy Problem with Multiple Discounts Offered by
Suppliers and Retailers
Moutaz Khouja
Department of MIS/OM, The Belk College of Business Administration,
The University of North Carolina at Charlotte, Charlotte, NC 28223
ABSTRACT
Recent extensions of the newsboy problem have focused on multiple
discounts used by retailers to sell excess inventory. Earlier
extensions have focused on quantity discounts offered by suppliers.
An important practical extension would address a combination of the
two previous extensions. In this paper, a newsboy problem with
supplier quantity discounts and retailer multiple discounts is
formulated and solved. The case of all-units supplier quantity
discounts is addressed, and the results with numerical examples are
illustrated.
Subject Areas: Inventory Management and
Production/Operations Management.
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