Posted: September 28th, 2016

If VAC has the power to offer contracts to its supplier and the supplier will satisfy the contract only if it makes a profit of at least $1000, find the buyback contract and the revenue sharing contracts that VAC should offer if the wholesale price is set at $175.4

Consider the Virginia Air Conditioner Inc company from the reading, Note of Optimal Ordering Strategies and Supply Chain Coordination.

Demand is given in Table 2 and cost data is given in Table 3.

If VAC has the power to offer contracts to its supplier and the supplier will satisfy the contract only if it makes a profit of at least $1000, find the buyback contract and the revenue sharing contracts that VAC should offer if the wholesale price is set at $175.4.