Optimal Production Output Decisions Under Demand Uncertainty

Authors

  • Andrey V. Petrusevich Graduate School of Management, Saint Petersburg State University, Russia

Abstract

Optimal Production Output Decisions Under Demand Uncertainty The article examines the optimal production output decisions problem in case of shift work and import opportunities over finite and infinite horizons in case the firm does not know the exact demand (informational uncertainty of demand). We develop the optimal production output strategy, which minimizes the expected total cost of production as the sum of direct and opportunity costs. The model is applied to global automobile companies.

Keywords:

mathematical modeling, uncertainty of demand, production output decisions, production capacity, value of information, automobile industry, supply chain management

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References

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Published

2011-12-23

How to Cite

Petrusevich, A. V. (2011). Optimal Production Output Decisions Under Demand Uncertainty. Russian Management Journal, 9(4), 35–50. Retrieved from https://rjm.spbu.ru/article/view/297

Issue

Section

New Research