Optimal price and pro rata decisions for combined warranty policies with different repair options

Timothy I. Matis; Raja Jayaraman; Alagar Rangan

doi:10.1080/07408170801971494

Optimal price and pro rata decisions for combined warranty policies with different repair options

Timothy I. Matis, Raja Jayaraman, Alagar Rangan

Industrial Engineering

Research output: Contribution to journal › Article › peer-review

24 Scopus citations

Abstract

A repairable product under a non-renewing combined warranty policy that is subject to a displaced log-linear demand function of the product's price and pro rata period length is considered. Expressions for the manufacturer's long-run average profit per unit time under replacement, minimal and general repair options are obtained. In addition, expressions for the stationary points and second-order conditions of the profit function are presented. Numerical illustrations that demonstrate optimal product pricing, pro rata length determination, and repair option selection to maximize the manufacturers, profit are given.

Original language	English
Pages (from-to)	984-991
Number of pages	8
Journal	IIE Transactions (Institute of Industrial Engineers)
Volume	40
Issue number	10
DOIs	https://doi.org/10.1080/07408170801971494
State	Published - 2008

Keywords

Combined warranty
General repair
Minimal repair
Pro rata warranty

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Optimal price and pro rata decisions for combined warranty policies with different repair options

Abstract

Keywords

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