Optimal pricing and quantity of products with two offerings

This paper analyzes the decision of a firm offering two versions of a product, a deluxe and a regular. While both products satisfy the same market, the deluxe version is sold at a high price relative to its cost and is aimed at the high end of the demand curve. The regular version is sold at a low price relative to its cost and is targeted to customers at the low end of the demand curve. This two-offering strategy is especially popular with book publishers where a paperback book is introduced some time after the hardbound version is introduced. The time between the introduction of the two versions of the product is accompanied by a downward shift in the demand curve due to customers losing interest in the product or satisfying their demand from a secondary used market. We solve a profit maximization model for a firm using a two-offering strategy. The model is solved for linear and exponential deterioration in demand, which is assumed to be deterministic. Also, a model with linear deterioration in demand, which is assumed to be stochastic, is solved. The results indicate that substantial improvements in profit can be obtained by using the two-offering strategy. Numerical sensitivity analysis and examples are used to illustrate the results.     

A New Definition of A Priori Knowledge: In Search of a Modal Basis

In this paper I will offer a novel understanding of a priori knowledge. My claim is that the sharp distinction that is usually made between a priori and a posteriori knowledge is groundless. It will be argued that a plausible understanding of a priori and a posteriori knowledge has to acknowledge that they are in a constant bootstrapping relationship. It is also crucial that we distinguish between a priori propositions that hold in the actual world and merely possible, non-actual a priori propositions, as we will see when considering cases like Euclidean geometry. Furthermore, contrary to what Kripke seems to suggest, a priori knowledge is intimately connected with metaphysical modality, indeed, grounded in it. The task of a priori reasoning, according to this account, is to delimit the space of metaphysically possible worlds in order for us to be able to determine what is actual.     

A Study on Abnormality in Variational and Optimal Control Problems

In this paper, a variational problem is considered with differential equality constraints over a variable interval. It is stressed that the abnormality is a local character of the admissible set; consequently, a definition of regularity related to the constraints characterizing the admissible set is given. Then, for the local minimum necessary conditions, a compact form equivalent to the well-known Euler equation and transversality condition is given. By exploiting this result and the previous definition of regularity, it is proved that nonregularity is a necessary and sufficient condition for an admissible solution to be an abnormal extremal. Then, a necessary and sufficient condition is given for an abnormal extremal to be weakly abnormal. The analysis of the abnormality is completed by considering the particular case of affine constraints over a fixed interval: in this case, the abnormality turns out to have a global character, so that it is possible to define an abnormal problem or a normal problem. The last section is devoted to the study of an optimal control problem characterized by differential constraints corresponding to the dynamics of a controlled process. The above general results are particularized to this problem, yielding a necessary and sufficient condition for an admissible solution to be an abnormal extremal. From this, a previously known result is recovered concerning the linearized system controllability as a sufficient condition to exclude the abnormality.     

A Chart for Evaluating Product Research and Development Projects

A method of evaluating research and development projects is described. The method is based on the use of an evaluation chart. The main purpose of the chart is to calculate a project score which is a measure of a selected evaluation criterion. A method of constructing a chart is illustrated using a project index as the evaluation criterion. The chart contains a list of twelve questions, the answers to which are assumed to be the main determinants of the variables in the formula of the index. Each question is followed by a set of answers from which a choice is to be made, and underneath each answer is a numerical score. The numerical scores are logarithmic functions of the answers to which they relate, and when added together give a project score which is a logarithmic function of the index. Various methods of using the chart, and a suggested evaluation procedure, are also described.     

Interface of global and local semantics in a self-navigating system based on the concept lattice

If the syntax–semantics interaction is driven by the interface, it also interrupts the interaction on its own right. Because the syntax is verified to be isomorphic to the semantics, the interaction is open to the diagonal argument leading to a contradiction. That is why it is necessary to introduce a particular interface to drive the interface to make the interaction possible despite the contradiction. In this context we propose the system implemented with the syntax–semantics loop by using a concept lattice and a particular weak quantifier. This system is expressed as the self-navigating system which wanders in a two-dimensional space, encounters some landmarks, constructs the relationship among landmarks to which decision making with respect to the move is referred. The syntax of this system is defined as two-dimensional move and the semantics is defined as a concept lattice [B. Ganter, R. Wille, Formal Concept Analysis, Springer, Berlin, 1999] constructed by the binary relation between landmarks and some properties of landmarks, and by Galois connection. To implement the interface driving and interrupting the interaction between syntax and semantics, we divided semantics into local and global concept lattices, and introduce a weak quantifier to connect a local with a global lattice. Because the contradiction results from diagonal argument or using a normal quantifier ∀, the use of a quantifier is restricted dependent on the situation to avoid a contradiction. It is shown that due to the role of a weak quantifier our self-navigating system is both robust and open to the emergent property through simulating studies.     

A comparison of two sourcing tactics for a new component

We compare two sourcing tactics for a manufacturer to purchase a new component to be used in a one-time production run of a new product with uncertain and price-elastic demand. One alternative is to issue a request-for-quote (RFQ), which is where the manufacturer requests a price-quantity schedule from suppliers. The manufacturer uses this information to determine a production quantity and the number of components to purchase from each supplier. The other alternative is to post a bid specifying how the manufacturer’s purchase quantity will depend on the supplier’s component price. The suppliers use this information to compete on quantity.We find that relative to RFQ, which is more challenging for the manufacturer to characterize the supplier response due to the possibility of supplier interaction, the benefit to the manufacturer from posting a bid increases with the number of suppliers due to increased intensity of competition. If the new component is from an emerging industry where there is little mutual awareness among candidate suppliers, then regardless of number of suppliers, expected manufacturer profit is higher under RFQ. Posting a bid is more likely to benefit the manufacturer when the new component is from a more established industry with a high degree of awareness among candidate suppliers.     

Higher order numerical differentiation on the Infinity Computer

There exist many applications where it is necessary to approximate numerically derivatives of a function which is given by a computer procedure. In particular, all the fields of optimization have a special interest in such a kind of information. In this paper, a new way to do this is presented for a new kind of a computer—the Infinity Computer—able to work numerically with finite, infinite, and infinitesimal numbers. It is proved that the Infinity Computer is able to calculate values of derivatives of a higher order for a wide class of functions represented by computer procedures. It is shown that the ability to compute derivatives of arbitrary order automatically and accurate to working precision is an intrinsic property of the Infinity Computer related to its way of functioning. Numerical examples illustrating the new concepts and numerical tools are given.     

Morphisms represented by monomorphisms

We answer a question posed by Auslander and Bridger. Every homomorphism of modules is projective-stably equivalent to an epimorphism but is not always to a monomorphism. We prove that a map is projective-stably equivalent to a monomorphism if and only if its kernel is torsionless, that is, a first syzygy. If it occurs, there can be various monomorphisms that are projective-stably equivalent to a given map. But in this case there uniquely exists a “perfect” monomorphism to which a given map is projective-stably equivalent.     

Optimal dividends in the Brownian motion risk model with interest

In this paper, we consider a Brownian motion risk model, and in addition, the surplus earns investment income at a constant force of interest. The objective is to find a dividend policy so as to maximize the expected discounted value of dividend payments. It is well known that optimality is achieved by using a barrier strategy for unrestricted dividend rate. However, ultimate ruin of the company is certain if a barrier strategy is applied. In many circumstances this is not desirable. This consideration leads us to impose a restriction on the dividend stream. We assume that dividends are paid to the shareholders according to admissible strategies whose dividend rate is bounded by a constant. Under this additional constraint, we show that the optimal dividend strategy is formed by a threshold strategy.     

Optimal policies for the sizing and timing of software maintenance projects

We present a model to determine the optimal point for maintaining a software application. We also address the question: given that a maintenance project has been initiated, should maintenance effort continue till the project is completed? Most previous literature has implicitly assumed that it is optimal to complete a maintenance project once it has been initiated. We analyze two policies: a work-based policy and a time-based policy. In the work-based policy, a fixed amount of work needs to be completed, and the time taken to accomplish the work is random. In the time-based policy, a fixed amount of time is allocated to maintenance, but a random amount of work is completed. We examine similarities and differences between the above two policies and provide insights into the management of software maintenance projects. A key insight of this study is that under a variety of situations, partial maintenance is suboptimal.     

Optimal detection of a recurring tuple of reference fragments in a quasiperiodic sequence

An a posteriori (off-line) approach to solving the problem of maximum-likelihood detection of a recurring tuple containing reference fragments in a numerical quasiperiodic sequence is studied. The case is analyzed where (1) the total number of fragments in a sequence is unknown; (2) the index of a sequence term corresponding to the beginning of a fragment is a deterministic (not random) value; (3) a sequence distorted by additive uncorrelated Gaussian noise is available for observation. It is shown that the problem under consideration is reduced to testing a set of simple hypotheses about the mean of a random Gaussian vector. The cardinality of this totality grows exponentially as the vector dimension (i.e., the length of the sequence under study) increases. It is established that searching for a maximum-likelihood hypothesis is equivalent to finding arguments that yield a maximum for an auxiliary objective function. It is shown that maximizing the objective function reduces to solving a special optimization problem, which is proved to be solvable in polynomial time. An exact algorithm for solving this problem, which underlies the optimal (maximum-likelihood) detection algorithm for a recurring tuple, is substantiated. The kernel of the exact algorithm is an algorithm for solving a special (basic) optimization problem. Results of numerical simulations are presented.     

An estimate of the attraction domain with a specified exponential stability index in a wheeled robot control problem

The problem of synthesizing a law for the control of the plane motion of a wheeled robot is investigated. The rear wheels are the drive wheels and the front wheels are responsible for the turning of the platform. The aim of the control is to steer a target point to a specified trajectory and to stabilize the motion along it. The trajectory is assumed to be specified by a smooth curve. The actual curvature of the trajectory of the target point, which is related to the angle of rotation of the front wheels by a simple algebraic relation, is considered as the control. The control is subjected to bilateral constraints by virtue of the fact that the angle of rotation of the front wheels is limited. The attraction domain in the distance to trajectory - orientation space, is investigated for the proposed control law. Arrival at a trajectory with a specified exponential stability index is guaranteed in the case of initial conditions belonging to the given domain. An estimate of the attraction domain in the form of an ellipse is given.     

马氏环境中可数马氏链的Poisson极限率

研究了马氏环境中的可数马氏链,主要证明了过程于小柱集上的回返次数是渐近地服从Poisson分布。为此,引入熵函数h,首先给出了马氏环境中马氏链的Shannon-Mc Millan-Breiman定理,还给出了一个非马氏过程Posson逼近的例子。当环境过程退化为一常数序列时,便得到可数马氏链的Poisson极限定理。这是有限马氏链Pitskel相应结果的拓广。     

Optimal inventory threshold for a dynamic service make‐to‐stock system with strategic customers

We consider a make‐to‐stock production system with one product type, dynamic service policy, and delay‐sensitive customers. To balance the waiting cost of customers and holding cost of products, a dynamic production policy is adopted. If there is no customer waiting in the system, instead of shutting down, the system operates at a low production rate until a certain threshold of inventory is reached. If the inventory is empty and a new customer emerges, the system switches to a high production rate where the switching time is assumed to be exponentially distributed. Potential customers arrive according to the Poisson process. They are strategic in the sense that they make decisions on whether to stay for product or leave without purchase on the basis of on their utility value and the system information on whether the number of products is observable to customers or not. The strategic behavior is explored, and a Stackelberg game between production manager and customers is formulated where the former is the game leader. We find that the optimal inventory threshold minimizing the cost function can be obtained by a search algorithm. Numerical results demonstrate that the expected cost function in an observable case is not greater than that in an unobservable case. If a customer's delay sensitivity is relatively small, these two cases are entirely identical. With increasing of delay sensitivity, the optimal inventory threshold might be positive or zero, and hence, a demarcation line is depicted to determine when a make‐to‐stock policy is advantageous to the manager.     

Computational error analysis of periodic solutions for singular semilinear parabolic problems

By using the monotone method, a theoretical and computational method is given to find, to the degree of accuracy desired, approximate solutions of a class of singular semilinear parabolic problems. So that the error between the actual solution and its approximation is within a given error tolerance, the number of iterations is determined. Since each iterate is in terms of an infinite series, the number of terms to be retained in each iterate is determined so that its error from the exact iterate is within a given error tolerance. An improved rate of convergence is then given to show that it is possible to reduce the number of terms retained in each iterate. An algorithm is also described to obtain numerical solutions. For illustration of the computational methods developed, a numerical example is given.     

Subspaces and quotients of Banach spaces with shrinking unconditional bases

The main result is that a separable Banach space with the weak* unconditional tree property is isomorphic to a subspace as well as a quotient of a Banach space with a shrinking unconditional basis. A consequence of this is that a Banach space is isomorphic to a subspace of a space with a shrinking unconditional basis if and only if it is isomorphic to a quotient of a space with a shrinking unconditional basis, which solves a problem dating to the 1970s. The proof of the main result also yields that a uniformly convex space with the unconditional tree property is isomorphic to a subspace as well as a quotient of a uniformly convex space with an unconditional finite dimensional decomposition.     

Economic production quantity with the presence of imperfect quality and random machine breakdown and repair based on the artificial bee colony heuristic

This article considers a production-inventory system consisting of a single imperfect unreliable machine. The items manufactured by the system are either perfect items or imperfect items, which require a rework to be restored to perfect quality. The rework rate is permitted to be different from the production rate if the rework process is different from the main manufacturing process. The fraction of the number of imperfect items is random following a general distribution function. The time to failure of the machine is random, following a general distribution function. If the machine fails before the lot is completed, the production is interrupted and the machine repair is started immediately. A random machine repair time is assumed, with a general distribution function. Unlike a common assumption in the literature, after the repair of the machine is completed, the production resumes. During the machine repair, a shortage can occur. A single-variable expected average cost function is derived to find the optimal lot size. Because of the complexity in the model, the ABC heuristic is proposed and implemented to find a near optimal value for the lot size. The article also provides a sensitivity analysis of the model's key parameters. It has been observed that the lot interruption-resumption policy leads to smaller lot sizes.     

Deriving weights from pairwise comparison ratio matrices: An axiomatic approach

This paper examines the problem of extracting object or attribute weights from a pairwise comparison ratio matrix. This problem is approached from the point of view of a distance measure on the space of all such matrices. A set of axioms is presented which such a distance measure should satisfy, and the uniqueness of the measure is proven. The problem of weight derivation is then shown to be equivalent to that of finding a totally transitive matrix which is a minimum distance from the given matrix. This problem reduces to a goal programming model. Finally, it is shown that the problem of weight derivation is related to that of ranking players in a round robin tournament. The space of all binary tournament matrices is proven to be isometric to a subset of the space of ratio matrices.     

A necessary and sufficient condition for Pareto-optimal security strategies in multicriteria matrix games

In this paper, a scalar game is derived from a zero-sum multicriteria matrix game, and it is proved that the solution of the new game with strictly positive scalarization is a necessary and sufficient condition for a strategy to be a Pareto-optimal security strategy (POSS) for one of the players in the original game. This is done by proving that a certain set, which is the extension of the set of security level vectors in the criterion function space, is convex and polyhedral. It is also established that only a finite number of scalarizations are necessary to obtain all the POSS for a player. An example is included to illustrate the main steps in the proof.This work was done while the author was a Research Associate in the Department of Electrical Engineering at the Indian Institute of Science and was financially supported by the Council of Scientific and Industrial Research, Delhi, India.The author wishes to express his gratefulness to Professor U. R. Prasad for helpful discussions and to two anonymous referees for suggestions which led to an improved presentation.     

Perspectives sur les recherches en didactique des mathématiques

The paper is a review of chosen approaches to research in mathematics education in several countries: Germany, France, United States, Russia, Poland, Canada. The review is done in the literary form of a satire, in which a character is taken on a voyage to a variety of “islands” respresenting different research interests and methodologies in mathematics education. The story is a parody of Homer’sOdyssee, and the main character is called Odysseus. Odysseus’ role is played by the famous arithmetic problem about a team of an unknown number of scythers who are given the task of scything two meadows one of which is double the size of the other. As the problem travels from one “island” to another, mathematics educators do different things to and with the problem and it is solved is a variety of ways. The main text of the paper reads as a story and there are no explicit references and names of authors, whose work is only alluded to. However, the solution to all allusions, i.e. explicit references, can be found in the footnotes.