A controlled birth and death process model of optimal product pricing under stochastically changing demand

1977 ◽  
Vol 14 (2) ◽  
pp. 328-339 ◽  
Author(s):  
S. D. Deshmukh ◽  
Wayne Winston
Keyword(s):  
Market Share ◽  
Process Model ◽  
Death Process ◽  
High Price ◽  
Optimal Pricing ◽  
Future Market ◽  
Birth And Death Process ◽  
Pricing Policy ◽  
Product Pricing ◽  
Markov Decision Model

We consider the problem of product pricing when the firm's market share is changing stochastically according to a birth and death process. The current market share together with the price prevailing determine the current rate of profit made as well as the birth and death rates. The optimal pricing policy must balance the immediate advantage of setting a high price in terms of increased current profit against the disadvantage in terms of a possible erosion of the future market share. We formulate a continuous-time Markov decision model and analyse it using a recent technique developed by Lippman [6] for optimization of exponential queueing systems. The optimal pricing policy is characterized as having a sort of monotonicity property. We also analyse the dependence of the optimal policy on the problem parameters and indicate further extensions of the model.

A controlled birth and death process model of optimal product pricing under stochastically changing demand

1977 ◽  
Vol 14 (02) ◽  
pp. 328-339 ◽  
Author(s):  
S. D. Deshmukh ◽  
Wayne Winston
Keyword(s):  
Market Share ◽  
Process Model ◽  
Death Process ◽  
High Price ◽  
Optimal Pricing ◽  
Future Market ◽  
Birth And Death Process ◽  
Pricing Policy ◽  
Product Pricing ◽  
Markov Decision Model

We consider the problem of product pricing when the firm's market share is changing stochastically according to a birth and death process. The current market share together with the price prevailing determine the current rate of profit made as well as the birth and death rates. The optimal pricing policy must balance the immediate advantage of setting a high price in terms of increased current profit against the disadvantage in terms of a possible erosion of the future market share. We formulate a continuous-time Markov decision model and analyse it using a recent technique developed by Lippman [6] for optimization of exponential queueing systems. The optimal pricing policy is characterized as having a sort of monotonicity property. We also analyse the dependence of the optimal policy on the problem parameters and indicate further extensions of the model.

Multi-Location Inventory Model Considering Bidirectional and Unidirectional Transshipments Simultaneously

2013 ◽  
Vol 694-697 ◽  
pp. 2742-2745
Author(s):  
Jin Hong Zhong ◽  
Yun Zhou
Keyword(s):  
Process Model ◽  
Approximate Calculation ◽  
Inventory Model ◽  
Inventory System ◽  
Death Process ◽  
Birth And Death Process ◽  
Inventory Models ◽  
Continuous Review ◽  
Poisson Demand ◽  
Queue Theory

Abstract. A cross-regional multi-site inventory system with independent Poisson demand and continuous review (S-1,S) policy, in which there is bidirectional transshipment between the locations at the same area, and unidirectional transshipment between the locations at the different area. According to the M/G/S/S queue theory, birth and death process model and approximate calculation policy, we established inventory models respectively for the loss sales case and backorder case, and designed corresponding procedures to solve them. Finally, we verify the effectiveness of proposed models and methods by means of a lot of contrast experiments.

scholarly journals Thinning spatial point processes into Poisson processes

2010 ◽  
Vol 42 (02) ◽  
pp. 347-358 ◽  
Author(s):  
Jesper Møller ◽  
Frederic Paik Schoenberg
Keyword(s):  
Point Process ◽  
Process Model ◽  
Goodness Of Fit ◽  
Point Processes ◽  
Death Process ◽  
Cox Process ◽  
Birth And Death Process ◽  
Conditional Intensity ◽  
Spatial Point Processes ◽  
Spatial Point

In this paper we describe methods for randomly thinning certain classes of spatial point processes. In the case of a Markov point process, the proposed method involves a dependent thinning of a spatial birth-and-death process, where clans of ancestors associated with the original points are identified, and where we simulate backwards and forwards in order to obtain the thinned process. In the case of a Cox process, a simple independent thinning technique is proposed. In both cases, the thinning results in a Poisson process if and only if the true Papangelou conditional intensity is used, and, thus, can be used as a graphical exploratory tool for inspecting the goodness-of-fit of a spatial point process model. Several examples, including clustered and inhibitive point processes, are considered.

scholarly journals Thinning spatial point processes into Poisson processes

2010 ◽  
Vol 42 (2) ◽  
pp. 347-358 ◽  
Author(s):  
Jesper Møller ◽  
Frederic Paik Schoenberg
Keyword(s):  
Point Process ◽  
Process Model ◽  
Goodness Of Fit ◽  
Point Processes ◽  
Death Process ◽  
Cox Process ◽  
Birth And Death Process ◽  
Conditional Intensity ◽  
Spatial Point Processes ◽  
Spatial Point

In this paper we describe methods for randomly thinning certain classes of spatial point processes. In the case of a Markov point process, the proposed method involves a dependent thinning of a spatial birth-and-death process, where clans of ancestors associated with the original points are identified, and where we simulate backwards and forwards in order to obtain the thinned process. In the case of a Cox process, a simple independent thinning technique is proposed. In both cases, the thinning results in a Poisson process if and only if the true Papangelou conditional intensity is used, and, thus, can be used as a graphical exploratory tool for inspecting the goodness-of-fit of a spatial point process model. Several examples, including clustered and inhibitive point processes, are considered.

The extinction time of a general birth and death process with catastrophes

1986 ◽  
Vol 23 (04) ◽  
pp. 851-858 ◽  
Author(s):  
P. J. Brockwell
Keyword(s):  
Laplace Transform ◽  
Size Distribution ◽  
Sufficient Conditions ◽  
Necessary And Sufficient Conditions ◽  
Death Process ◽  
Extinction Time ◽  
Birth And Death Process ◽  
Different Types ◽  
The Laplace Transform ◽  
Necessary And Sufficient

The Laplace transform of the extinction time is determined for a general birth and death process with arbitrary catastrophe rate and catastrophe size distribution. It is assumed only that the birth rates satisfyλ0= 0,λj> 0 for eachj> 0, and. Necessary and sufficient conditions for certain extinction of the population are derived. The results are applied to the linear birth and death process (λj=jλ, µj=jμ) with catastrophes of several different types.

scholarly journals Charging Station Allocation for Electric Vehicle Network Using Stochastic Modeling and Grey Wolf Optimization

2021 ◽  
Vol 13 (6) ◽  
pp. 3314
Author(s):  
Rawan Shabbar ◽  
Anemone Kasasbeh ◽  
Mohamed M. Ahmed
Keyword(s):  
Markov Chain ◽  
Electric Vehicles ◽  
Process Model ◽  
Transportation Network ◽  
Optimal Placement ◽  
Death Process ◽  
Chain Model ◽  
Grey Wolf ◽  
Grey Wolf Optimization ◽  
Net Profit

Optimal placement of Charging stations (CSs) and infrastructure planning are one of the most critical challenges that face the Electric Vehicles (EV) industry nowadays. A variety of approaches have been proposed to address the problem of demand uncertainty versus the optimal number of CSs required to build the EV infrastructure. In this paper, a Markov-chain network model is designed to study the estimated demand on a CS by using the birth and death process model. An investigation on the desired number of electric sockets in each CS and the average number of electric vehicles in both queue and waiting times is presented. Furthermore, a CS allocation algorithm based on the Markov-chain model is proposed. Grey Wolf Optimization (GWO) algorithm is used to select the best CS locations with the objective of maximizing the net profit under both budget and routing constraints. Additionally, the model was applied to Washington D.C. transportation network. Experimental results have shown that to achieve the highest net profit, Level 2 chargers need to be installed in low demand areas of infrastructure implementation. On the other hand, Level 3 chargers attain higher net profit when the number of EVs increases in the transportation network or/and in locations with high charging demands.

A stochastic process related to language change

1970 ◽  
Vol 7 (01) ◽  
pp. 69-78 ◽  
Author(s):  
Barron Brainerd
Keyword(s):  
Stochastic Process ◽  
Language Change ◽  
Death Process ◽  
Birth And Death Process ◽  
Standard Methods

The purpose of this note is two-fold. First, to introduce the mathematical reader to a group of problems in the study of language change which has received little attention from mathematicians and probabilists. Secondly, to introduce a birth and death process, arising naturally out of this group of problems, which has received little attention in the literature. This process can be solved using the standard methods and the solution is exhibited here.

AN AGE-DEPENDENT BIRTH AND DEATH PROCESS

Biometrika ◽  
1955 ◽  
Vol 42 (3-4) ◽  
pp. 291-306 ◽  
Author(s):  
W. A. O'N WAUGH
Keyword(s):  
Death Process ◽  
Birth And Death Process ◽  
Age Dependent
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