Analyzing newsvendor problems by one-shot decision approaches with considering regret

In this paper, a single-period inventory problem with partially known demand information characterized by possibility distributions is analyzed. Decision models are proposed based on one-shot decision approaches where three choices with considering regret of decision are provided. These three choices are used for determining which state of nature (demand) should be considered for each order quantity. Based on the selected states of nature (focus point), the optimal order quantity is obtained. Different kinds of focus points (demands) lead to different results (optimal order quantities) which reflecting a decision maker's attitudes about possibility of demand and regret of decision.