Managing Emergency Procurement Using Option Contract under Supply Disruption and Demand Uncertainty

<div>The relationship between optimal decision and disruption probability under no option contract <span class="nowrap"><svg height="12.7178pt" id="M116" style="vertical-align:-3.42947pt" version="1.1" viewbox="-0.0498162 -9.28833 40.332 12.7178" width="40.332pt" xmlns="http://www.w3.org/2000/svg" xmlns:xlink="http://www.w3.org/1999/xlink"><g transform="matrix(.013,0,0,-0.013,0,0)"><path d="M300 -147C201 -63 143 98 143 270S200 602 300 686L282 710C136 610 70 450 70 271V270C70 89 136 -72 282 -170L300 -147Z"></path></g><g transform="matrix(.013,0,0,-0.013,4.498,0)"><path d="M383 397C383 424 344 448 299 448C244 448 172 409 132 375C66 319 23 227 23 146C23 42 74 -12 146 -12C208 -12 298 30 359 103L343 124C315 95 248 48 192 48C145 48 111 85 111 163C111 228 129 294 151 330C171 363 201 401 241 401C275 401 302 384 325 356C332 347 339 344 348 348C373 360 383 381 383 397Z"></path></g><g transform="matrix(.0091,0,0,-0.0091,8.671,3.132)"><path d="M398 365C398 411 356 451 297 451C250 451 198 430 151 397C65 336 24 230 24 139C24 14 97 -12 148 -12C198 -12 284 7 373 104L355 130C306 84 246 53 198 53C132 53 111 109 111 163V189C209 211 398 261 398 365ZM317 351C317 308 273 262 117 225C134 338 189 383 221 399C230 404 249 407 263 407C295 407 317 389 317 351Z"></path></g><g transform="matrix(.013,0,0,-0.013,16.656,0)"><path d="M512 230V281L75 514V456L453 256V254L75 55V-3L512 230Z"></path></g><g transform="matrix(.013,0,0,-0.013,27.918,0)"><path d="M570 304C570 398 525 448 414 448C385 448 343 445 312 434L329 511L321 518C297 504 262 482 244 460L233 411C195 397 159 381 128 358L135 332C160 347 189 360 224 373L111 -147C97 -210 84 -218 17 -231L13 -257L254 -247L259 -218L233 -216C183 -212 177 -202 189 -142L218 -1C238 -10 266 -12 283 -12C351 3 429 48 483 105C543 168 570 242 570 304ZM482 289C482 161 380 33 304 33C278 33 248 51 233 69L303 396C326 400 352 403 369 403C428 403 482 380 482 289Z"></path></g><g transform="matrix(.013,0,0,-0.013,35.629,0)"><path d="M275 270C275 450 212 609 64 710L45 686C145 604 203 442 203 270S147 -63 45 -147L64 -170C213 -68 275 89 275 270Z"></path></g></svg>.</span></div>

Mathematical Problems in Engineering

fig5

Figure 5

Figure 5: Managing Emergency Procurement Using Option Contract under Supply Disruption and Demand Uncertainty 