The Quota-Based Compensation Plan in Fashion Retailing Industry under Asymmetric Information

Table 1

Optimal profit under a quota-based compensation plan.

	Low state; 1−𝜌	High state; 𝜌
∏^0	2𝑑𝐿𝑍(𝑝−𝑐)+𝑟𝐿𝜇^2(𝑍−𝑞)(𝑝−𝑐)2𝑍−𝑟𝐿𝜇^2−𝑟𝐿^2𝜇^2(𝑑𝐿+𝑍−𝑞)^22(2𝑍−𝑟𝐿𝜇^2)^2	2𝑑𝐻𝑍(𝑝−𝑐)+𝑟𝐻𝜇^2(𝑍−𝑞)(𝑝−𝑐)2𝑍−𝑟𝐻𝜇^2−𝑟𝐻^2𝜇^2(𝑑𝐻+𝑍−𝑞)^22(2𝑍−𝑟𝐻𝜇^2)^2−𝑟𝐿(𝑑𝐿+𝑑𝐻+2𝑍−2𝑞)(𝑑𝐻−𝑑𝐿)2(2𝑍−𝑟𝐿𝜇^2)
𝜋^0	𝜋min	(𝑝−𝑐)(𝑑𝐻+𝑍−𝑞)2+𝑟𝐿(𝑑𝐻+𝑍−𝑞)^22(2𝑍−𝑟𝐿𝜇^2)−𝑟𝐿(𝑑𝐿+𝑍−𝑞)^22(2𝑍−𝑟𝐿𝜇^2)−𝑟𝐻(𝑑𝐻+𝑍−𝑞)^22(2𝑍−𝑟𝐻𝜇^2)