Cost analysis of pro rata and free‐replacement warranties

John W. Mamer

Naval Research Logistics Quarterly, 1982, vol. 29, issue 2, 345-356

Abstract: This article examines the short run total costs and long run average costs of products under warranty. Formulae for both consumer cost under warranty and producer profit are derived. The results in the case of the pro rata warranty correct a mistake appearing in Blischke and Scheuer [5]. We also show that expected average cost to both the producer and the consumer of a product under warranty depends on both the mean of the product lifetime distribution and on its failure rate.

Date: 1982
References: Add references at CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
https://doi.org/10.1002/nav.3800290214

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wly:navlog:v:29:y:1982:i:2:p:345-356

Access Statistics for this article

More articles in Naval Research Logistics Quarterly from John Wiley & Sons
Bibliographic data for series maintained by Wiley Content Delivery ().