Production Management. Sharing demand information.
A retailer following a (Q,r) policy and facing Poisson demands, places order of size Q with a supplier that does not have economies of scale in ordering/producing.
1. Explain the form of the supplier's optimal policy in the absence of demand information sharing.
2. Explain the form of the supplier's optimal policy if the retailer shares demands information with the supplier.
3.Under what conditions will the retailer be willing to share information?