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The optimal launch schedule for two new cannibalistic durables: A diffusion theory approach
No full text[[abstract]]This study presents the optimal timing framework for the seller who is going to launch two cannibalistic durables and commits the information of the products before he launches them. We find that the seller should adopt an appropriate introduction strategy in considering the unit profitabilities of his products. The product that is more profitable per unit should be launch first, and the less profitable in unit the other product is, the later the seller should launch it. Besides, cannibalization has shown to be of no concern for the introduction sequence of the products, but there is a positive relation between the cannibalization possibility and the launch timing of the product released later. The scale of the seller's announcement and the attitude of customers in information acquisition will also influence the launching schedule
Optimal human resource allocation with finite servers and queuing capacity
No full text[[abstract]]The optimisation of finite queuing capacity in a fast-food store is researched in this study. This paper not only applies queuing theory with finite servers and finite queue size into the mathematical model, but also introduces the cumulative probability function of customer psychological attitude for leaving into the objective function. In addition, the step-by-step algorithm for optimising the human resource allocation is also provided. Moreover, the computerised tool written in the language of Visual Basic to reach the maximum profit is completely proposed in this paper, and a numerical example is discussed to show all steps for achieving the optimal solution. This study definitely contributes an efficient strategy and a practical tool for management decision makers with profound insight
An Extended Newsvendor Model with Time-Variant Ordering Decisions
No full text[[abstract]]This paper is to extend the classical newsvendor model with multistage decision making logic for determining the optimal ordering time and quantity so that the expected profit is maximized. The proposed model correctly represents for the newsvendor problem with three distinguishing features: (i) the unit ordering cost and the shortage cost are no longer regarded as the fixed parameters, but rather, are the time-variant functions; (ii) the ordering time ahs been incorporated into the classical newsvendor model; (iii) a multistage evaluation logic is designed to assure of finding the optimal ordering policy whenever the time lag exists between the decision time and the executive time
A Factor-Copula Based Valuation of Synthetic CDO-Squared under a Stochastic Intensity
No full text[[abstract]]This study extends the double student's t factor copula models developed by Hull and White (2004) for valuing CDO-Squared. First, the assumptions of non-homogeneous recovery rates are adopted to fit realistic aggregate loss of CDO collateral. Second, a stochastic hazard rate is proposed using the CIR intensity process to resolve the problem of inability of constant intensity rate to capture instantaneous credit spread dynamics. To construct the default probability distribution of CDO-Squared, the factor copula model is derived using the two-stage probability bucketing method to approximate loss distribution. Finally, the example of CDO-Squared issued by the Polaris Securities Group in Taiwan is presented to illustrate fair credit spread pricing for various tranches
The Optimal Compensation for Heterogeneous Salesforce
No full text[[abstract]]As a member of the heterogeneous salesforce, every salesperson’s demand and sales are both various. A payment may not be satisfactory for all salesman. Therefore, this paper deals with the problem how a firm designs a compensation plan in order to meet every salesperson’s demand. We set up a mathematical model, according to the interaction of the distribution of different salesman, their demand, and a firm’s profits. The model is solved with the optimal control theory and the optimal compensation for heterogeneous salesforce can thus be found. Moreover, we obtain several interesting characteristics from the optimal solution
Solving dynamic model of environment pollution and sustainable development by the degenerate simplex method
No full text[[abstract]]The purpose of this paper is to approve how the degenerate simplex method solving the dynamic model of environmental pollution and sustainable development. Under the consideration of the environmental pollution and sustainable development, the objective function of this model is to maximize the total present utility value of current and future generations. To internalize the externality, the environmental protection policy is to collect the pollution tax not only from producer but also from consumer in order to accordance with the spirit of social justice. We get the optimal solutions by the degenerate simplex method of calculus of variations, and we describe the basic meanings of the optimal solutions as our conclusions
Optimization model for salesforce compensation under effort level
No full text[[abstract]]An important decision faced by sales manager's toady is precisely how much compensationshould be offered to the salesforce. In this paper, we adopt the model structure and prospecting technology of Joseph [11]. We set up a dynamic mathematical model to study how a firm can design an optimal incentives scheme in order to pursue the maximum profit from the salesforce effort in target market, while the firm launch new product. From the sensitivity analysis of the optimal solution of the model this paper discusses the effects of the effort level, commission rate and total profits
The effect of finite resource on environmental policy
No full text[[abstract]]Since pollution abatement activities require the consumption of resource, they can be seen as an exchange of resource for clean environment. In perspective of finite resource supply and sustainable development, a model is presented to analyze the effect of various exogenous parameters such as the resource stock level, technical progress, and market demand, etc. on the optimal point. The results reveal that (1) the society with less resource stock must take some other measures such as technology innovation to increase its production level and improve its environment, (2) the increase in production is limited by technological progress, and (3) the increase in market demand leads to the increase in production, but also make environmental quality worse