Effects of Centralization in Multi-Location Newsboy Problems

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In this paper, a multi-location, single-period inventory problem is examined. We prove that the centralized system is usually better than the decentralized system. We show the Expected Value of Additional Information (EVAI) using the distribution free approach. Also, we extend the basic model in several directions under the worst case. This paper shows the effect of centralization and information of distribution using the practical models with reasonable assumptions.