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Financing newsvendor inventory. (English) Zbl 1151.91497
Summary: 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.

MSC:
91B28 Finance etc. (MSC2000)
90B05 Inventory, storage, reservoirs
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