Investment and capacity choice under uncertain demand

The Effect Of Salvage Market On Strategic Technology Choice And Capacity Investment Decision Of Firm Under Demand Uncertainty

The Impact of Budget Constraints on Flexible vs. Dedicated Technology Choice

This paper studies the flexible-versus-dedicated technology choice and capacity investment decisions of a multi-product firm under demand uncertainty in the presence of budget constraints. The firm operates under a capital budget for financing the capacity investment, and an operating budget, which is uncertain in the capacity investment stage, for financing the production. We investigate how t...

Strategic Technology Choice and Capacity Investment Under Demand Uncertainty

This paper studies the impact of competition on a firm’s choice of technology (product-flexible or product-dedicated) and capacity investment decisions. Specifically, we model two firms competing with each other in two markets characterized by price-dependent and uncertain demand. The firms make three decisions in the following sequence: choice of technology (technology game), capacity investme...

Optimal flexible capacity in newsboy problem under stochastic demand and lead-time

In this paper, we consider a newsvendor who is going to invest on dedicated or flexible capacity, our goal is to find the optimal investment policy to maximize total profit while the newsvendor faces uncertainty in lead time and demand simultaneously. As highlighted in literature, demand is stochastic, while lead time is constant. However, in reality lead time uncertainty decreases newsvendor's...

Investment, Capacity Choice and Outsourcing under Uncertainty

In this paper, we formulate a firm’s investment in a production facility with maximum capacity and outsourcing strategy. Existing literature of capacity choice results in an explosive capacity and long delay in investment. Actually, there are slight possibility that a firm installs a facility with an explosive capacity, instead, a firm can outsource production when the demand exceeds its capaci...