Supply diversification and pricing are two common mechanisms for dealing with supply yield uncertainty. This paper characterizes a firm's pricing and sourcing decisions under supply yield uncertainty, and studies the interplay between the two mechanisms. We compare the optimal sourcing decisions...

Problem Definition:This paper studies the sourcing of a monopoly firm that procures from multiple unreliable suppliers to meet its deterministic/price-dependent demand. The suppliers' production processes are unreliable and are modeled by correlated proportional random yields. Academic/Practical...