Firm A's demand for a product is 15 units per month. Its supplier charges an ordering cost of $5 per order and $10 per unit with
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During the beginning of the 21st century, the growth in computer sales declined for the first time in almost two decades. As a result, PC makers dramatically reduced their orders of computer chips from Intel and other vendors. In general, the environment in which computer manufacturers operate is very uncertain; how should we expect this feature of the market to affect the length of contracts between computer manufacturers and their hardware manufacturers?
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