Optimal Pricing Policies For Deteriorating items With Preservation Technology And Price Sensitive Demand

Authors

  • Nita H. Shah Gujarat University, Ahmedabad, Gujarat, India
  • Arpan D. Shah Gujarat University

DOI:

https://doi.org/10.24297/jam.v4i2.2489

Keywords:

Deteriorating items, Preservation technology investment, Price sensitive stock dependent demand

Abstract

This paper considers the problem of determining the price, cycle time and preservation technology cost strategies for deteriorating items. It is assumed that preservation technology investment and demand rate do follow the function of selling price. The objective is to maximize the total profit per unit time with determining the optimal selling price, length of replenishment cycle and preservation technology investment. We will be proving that the optimal cycle length and selling price are unique with respect to given preservation cost. Also, total profit per unit time will be a concave function as it will reach its optimum value for optimum value of selling price, cycle length and preservation technology cost. Numerical examples are also presented to demonstrate the solution process.

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Author Biographies

Nita H. Shah, Gujarat University, Ahmedabad, Gujarat, India

Department of mathematics

Arpan D. Shah, Gujarat University

Department of Mathematics

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Published

2013-11-18

How to Cite

Shah, N. H., & Shah, A. D. (2013). Optimal Pricing Policies For Deteriorating items With Preservation Technology And Price Sensitive Demand. JOURNAL OF ADVANCES IN MATHEMATICS, 4(2), 384–393. https://doi.org/10.24297/jam.v4i2.2489

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Section

Articles