COMMERCE 2OC3 Chapter Notes - Chapter 13: Quantile, Exponential Distribution, Randomness
23 Jun 2019
School
Department
Course
Professor
Document Summary
The planning process of allocating scarce resources to customers to maximize revenue. Single-item revenue management; uncertain demand, perishable products. Cs = cost of shortage = sales price/unit cost/unit. Co = cost of overage = cost/unit salvage value/unit. Critical fractile = cu/(cu + co) Optimal order quantity q* = + z : z = (q*- )/ . Q can be: number of rooms to save for last minute customers, number of overbookings. G(p) demand function in terms of price p. Optimal price maximizep 0[p x g(p)] take derivative. E. g. suppose demand is deterministic and defined by g(p) = 100 2p, what is the optimal price to maximize revenue: rev = p x g(p) 100 4p = 0 p* = 25: rev* = 100 x 25 2(25)2 = 1250. Attribute of a queueing system: arrival process: distribution of time between two arrivals (constant, exponential dist. , uniform dist. ) Service time: number of services, queueing discipline, which customers to serve first (fcfs, priority-based, random)
