Notation

Meaning

Notation

Meaning

p

Retail price

R

Retailers

w

Wholesale Price

M

Supplier

c

q

Production cost

Order quantity

N

SC optimal order

neutral risk

v

s

g

Salvage value

Shortage cost

Buyback price

U(*)

π(*)

Retailer optimal order

utility function

benefit function

Loss aversion

E[U(*)]

Expect utility function