Investment Decision Model for Remanufacturing Under Return Uncertainty

Mei-Ting Tsai ()
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Mei-Ting Tsai: National Chung Hsing University

A chapter in LISS 2014, 2015, pp 189-193 from Springer

Abstract: Abstract Remanufacturing is a means of achieving environmental sustainability. However, uncertainties make remanufacturing investment decision more complex. This paper develops an investment model to find the optimal investment timing while taking returned quantity uncertainty into consideration. When the dynamics of the returned quantity follows Geometric Brownian Motion, the investment timing problem is analogous to an American call option with dividends problem. A numerical example is conducted to illustrate the proposed decision support model.

Keywords: Closed-loop supply chain; Remanufacturing; Investment; Decision model; Real options (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-662-43871-8_29

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DOI: 10.1007/978-3-662-43871-8_29

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