Abstract
In the case of buying and selling commodieties succesively such as newspaper-boy problem, the risk of insolbvency is not necessarily reduced by buying commodities in a small quantity. The less commodities we buy for the first round, the smaller risk of insolvency will reuslt, but on the contrary, this risk may be kept high for the successieve rounds because of the smaller savings obtained. Therefore, the optimum policy to reduce the risk of insolvency in the short-tem is not always the same as that in the long-term. This paper proposes a method to determine the optimum policy to minimize the risk insolvency onthe long-term point of view.
