STOCHASTIC PROFIT MODELS UNDER REPAIR-LIMIT REPLACEMENT PROGRAM

Tadashi Dohi, Naoto Kaio and Shunji Osaki
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Tadashi Dohi: Department of Information Engineering, Graduate School of Engineering, Hiroshima University, 1–4–1 Kagamiyama, Higashi-Hiroshima 739–8527, Japan
Naoto Kaio: Department of Economic Informatics, Faculty of Economic Sciences, Hiroshima Shudo University, 1-1-1 Ozukahigashi, Asaminami-Ku, Hiroshima 731-3195, Japan
Shunji Osaki: Department of Information and Telecommunication Engineering, Faculty of Mathematical Sciences and Information Engineering, Nanzan University, 27 Seirei-Cho, Seto 489-0863, Japan

Chapter 10 in Recent Advances in Stochastic Operations Research II, 2009, pp 139-150 from World Scientific Publishing Co. Pte. Ltd.

Abstract: AbstractIn this paper, we consider two repair-time limit replacement problems under earning rate criteria with and without discounting. First, the optimal repair-time limits, which maximize the long-run average profit rate and the expected total discounted profit over an infinite time horizon, are analytically derived. Next, we develop statistically non-parametric algorithms for estimating the optimal repair-time limits, provided that the complete sample data of repair time are given. The basic idea is to apply the Lorenz statistics and to transform the underlying algebraic optimization problems to the graphical ones.

Keywords: Operations Research; Uncertainty; Applied Probability; Stochastic Process; Optimization; Decision Science (search for similar items in EconPapers)
Date: 2009
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