337
Appendix 2: Product Upgrades Based on Minimum Expected Quality Loss
Y
10
9
8
7
s
e
s
s
o
6
L
y = x
5
y = 1/x
4
3
2
1
X
0
0
1
2
3
4
5
6
7
8
9
10 11 12
Performance
FIgure A2.2
Smaller-the-better (STB: y = x, seller) and larger-the-better (LTB: y = 1/x, buyer).
0
0
1
2
3
4
5
6
7
Losses
8
9
10
Y
X
1
2
3
4
5
Performance
6
7
8
9
10 11 12
Minimum
loss
FIgure A2.3
Combining two loss distributions that compete for a definitive product upgrade period, m.