Profit Function Research Articles

Integrated three layer supply chain inventory model for price sensitive and time dependent demand with suggested retail price by manufacturer

This paper presents an integrated three layer supply chain policy for multi-channel and multi-echelon consisting manufacturer, distributors and retailers as supply chain members. The demand of retailers end is considered as linear function of time and retail price. The average net profit function per unit time is derived for each supply chain member which are based on demand of retailer's end. Since holding cost of goods/inventory is expensive in developed areas, we have introduced a new concept to share holding cost among distributors and retailers. We have optimized lot size, retailing price and replenishment time interval for retailers. We have also optimized initial inventory level and wholesale price for distributors and manufacturer respectively. This study is performed in two different categories one is decentralized and other is centralized scenario. The profit function of each supply chain members has been derived and shown as a concave function with respect to decision variables. More over propositions and results are made to illustrate the proposed model and we have sensitive analyzed it with numerical example.

Liner shipping network design with sensitive demand

Purpose This paper aims to examine containership routing and speed optimization for maritime liner services. It focuses on a realistic case in which the transport demand, and consequently the collected revenue from the visited ports depend on the sailing speed. Design/methodology/approach The authors present an integer non-linear programming model for the containership routing and fleet sizing problem, in which the sailing speed of every leg, the ports to be included in the service and their sequence are optimized based on the net line's profit. The authors present a heuristic approach that is based on speed discretization and a genetic algorithm to solve the problem for large size instances. They present an application on a line provided by COSCO in 2017 between Asia and Europe. Findings The numerical results show that the proposed heuristic approach provides good quality solutions after a reasonable computation time. In addition, the demand sensitivity has a great impact on the selected route and therefore the profit function. Moreover, the more the demand is sensitive to the sailing speed, the higher the sailing speed value. Research limitations/implications The vessel carrying capacity is not considered in an explicit way. Originality/value This paper focuses on an important aspect in liner shipping, i.e. demand sensitivity to sailing speed. It brings a novel approach that is important in a context in which sailing speed strategies and market volatility are to be considered together in network design. This perspective has not been addressed previously.

Optimal pricing model of car-sharing: market pricing or platform pricing

PurposeThe car-sharing market has entered the mature stage, and consumers' demand shows a diversified increasing trend. This paper considers two modes of operation and two pricing strategies, which are business-to-consumer and consumer-to-consumer modes, market pricing and platform pricing. Under these conditions, the platform's revenue-sharing ratio will be different. The purpose of this paper is to explore this research question, and seeks an optimal pricing mechanism that can achieve a win–win situation between platform and automobile manufacturer in the two market modes.Design/methodology/approachThe authors design different profit functions for platform under the two contexts. Of course, the platform's function is constrained to the manufacturer's function. By introducing a revenue-sharing contract a Stackelberg game model dominated by the platform is established and the equilibrium solutions under the two pricing models are derived.FindingsThe study found that even if only market pricing is executed, the scale of the car-sharing market will continue to expand. As the car-sharing market becomes more saturated, platform pricing is better for the automobile manufacturer; in most cases, the platform prefers platform pricing, but when the number of private cars is relatively small, if the cost of car operation and maintenance for the automobile manufacturer is lower or the revenue-sharing ratio of private cars is high, then market pricing will be more favorable to the platform.Practical implicationsWith the cross-border integration of car service platforms and the automobile manufacturing industry, the key to achieving win–win cooperation and sustainable development in the car-sharing market will converge on the question of how to design a suitable pricing mechanism and revenue-sharing method.Originality/valueAuthors have determined how a car-sharing platform achieves a win–win order pricing strategy with the manufacturer and private car owners, respectively. And authors combined the supply chain revenue-sharing contract with the car-sharing market to explore the application of the revenue-sharing contract in the sharing economy.

Predicting the dynamics of the maximum and optimal profits of innovative enterprises

This article proposes new economic and mathematical models of the dynamics of the development of industrial enterprises that introduce innovative technologies. The level of attraction of innovative technologies by the enterprise is set by dimensionless coefficients of innovations, which depend on time and affect the increase in output and decrease in costs. The influence of not only production costs, but also transaction costs on the size of the enterprise’s profit was investigated, the sources of which are the forced costs of searching and processing economic information, financing negotiation procedures, developing and concluding contracts with partners, organizing the protection of property rights, paying for the opportunistic behavior of employees and enterprise managers, etc. It is found, that transaction costs force to maximize not only the profit function of the enterprise, but also the target transaction utility function, which takes into account the redistribution of profits in the interests of the enterprise management and for the implementation of socially oriented programs. The size of the part of the profit spent in the interests of the enterprise management and for the implementation of socially oriented programs is set by dimensionless redistribution coefficients. It is shown, that in the presence of transaction costs, the enterprise, instead of the maximum value of profit, achieves a lower optimal value of profit.

Optimal structure of joint inventory-pricing management with dual suppliers and different lead times

We consider a joint inventory-pricing control problem in a single-product, periodic-review, dual-supplier inventory system. The two suppliers have different lead times. One expedited supplier offers instantaneous replenishment, and one regular supplier requires an L-period lead time for delivery. The supply quantity is stochastic and the demand is price-dependent. For the expedited inventory replenishment, we characterize the optimal policy as a state-dependent almost-threshold policy by extending the stochastically linear in mid-point to a multidimensional setting. To investigate the optimal regular inventory replenishment and pricing policy, we propose the notions of partially stochastic translation (PST) and increasing partially stochastic translation (IPST), which help in obtaining the antimultimodularity preservation in dynamic programming problems. We provide properties, sufficient conditions, and examples for PST and IPST functions. By applying PST and IPST, we obtain the antimultimodularity of the profit functions. The antimultimodular profit functions ensure that the optimal regular ordering quantity and the optimal price are monotone in the current inventory level and outstanding order quantities. Moreover, we reveal that as the time interval increases, the effects of previous outstanding orders on the optimal regular ordering and pricing decisions are decreasing and increasing, respectively. PST and IPST also enable us to further characterize the optimal expedited ordering quantity as decreasing in the inventory level. However, the optimal expedited ordering quantity can be non-monotone with respect to the outstanding order quantities, as shown in the example.

An queueing model with improved delay sensitive medical packet transmission scheduling system in e-health networks

Electronic health (e-health) is commonly recognized as a promising model for raising the enormous pressure on conventional healthcare systems. In this paper, an improved delay-sensitive medical packet transmission scheduling system has been proposed to manage the medical packet transmission in e-health networks. It focuses on communication through the wireless body area network (over WBAN). Medical packets arrive at the gateway (generally with one patient). Their applications are reported with different time-sensitivities to the service provider (i.e., the base station), illustrates the value of their medical signal. Then the priority queue is designed for the order of transmission. The base station analyzes the service key parameters by developing the packet utility and the base station's profit functions. It creates an evaluation-compatible method so that all gateways are required to disclose their medical packet's actual delay sensitivities. Experimental analysis has shown that the proposed method will maximize the base station's profits, thus providing a higher priority medical packet service.

A Dynamic Intersecting Arrangement Model Based on Isolated Draw Zones for Stope Structure Optimization during Sublevel Caving Mining

In this paper, stope structure optimization during sublevel caving mining is considered under the condition that the isolated draw zones (IDZs) are nonstandard ellipsoid, which is realized by dynamically adjusting the arrangement of IDZs and quantifying the degree of intersection of IDZs according to an ore profit and loss calculation model. A dynamic intersecting arrangement model based on IDZs was proposed, which can dynamically adjust the sublevel height and drift spacing according to the ore-rock bulk flow parameters, economic indicators, occurrence condition of the ore body, drilling machine, and so forth. Based on the model, the range of drift spacing, the lower volume of crestal residual ore, and the higher volume of mixing waste rock are calculated. By deducing the function of ore profit and loss, a calculation model for ore profit and loss is established to quantify the degree of intersection of IDZs and determine the best stope structure. Using the constructed dynamic intersecting arrangement model, a stope structure of −213 m to −303 m in the Yanqianshan Iron Mine was designed, with a sublevel height of 22.5 m and a drift spacing of 20.5 m. A physical drawing model was designed, and three physical simulation experiment schemes were conducted to compare and analyse the ore loss and dilution of the intersecting arrangement model and the traditional tangent arrangement model. The results showed that the loss rate decreased by 3.66% and the dilution rate increased by only 0.22%, thus verifying the effectiveness and applicability of the model to optimize the stope structure.

Herd life, lifetime production, and profitability of Viking Red-sired and Montbéliarde-sired crossbred cows compared with their Holstein herdmates

The first 2 generations from a 3-breed rotation of the Viking Red (VR), Montbéliarde (MO), and Holstein (HO) breeds were compared with their HO herdmates in high-performance commercial herds in Minnesota. The designed study enrolled pure HO females in 2008 to initiate a comparison of 3-breed rotational crossbreds with their HO herdmates. Sires of cows were proven artificial insemination bulls selected for high genetic merit in each of the 3 breeds. The first-generation cows calved for a first time from 2010 to 2014 and had 376 VR × HO and 358 MO × HO crossbreds to compare with their 640 HO herdmates. The second-generation cows calved for a first time from 2012 to 2014 and had 109 VR × MO/HO and 117 MO × VR/HO crossbreds to compare with their 250 HO herdmates. Collection of data ceased on December 31, 2017, and all cows studied had the opportunity for 45 mo in the herd after first calving. Production of milk, fat, and protein (kg) during lifetimes of cows was estimated from test-day observations with best prediction. The lifetime profit function included revenue and cost. Revenue was from production, calves, and slaughter of cull cows. Costs included feed cost during lactation, lactating overhead cost, dry cow cost (including feed cost during dry periods), replacement cost, health treatment cost, insemination cost, fertility hormone cost, pregnancy diagnosis cost, hoof trimming cost, and carcass disposal cost. For individual cows with herd life longer than 45 mo after first calving, survival of cows was projected beyond 45 mo after first calving to estimate herd life, production, and profitability. The 2-breed crossbreds had +158 d longer herd life and the 3-breed crossbreds had +147 d longer herd life compared with their respective HO herdmates. Also, 12.4% of the 2-breed crossbreds died up to 45 mo after first calving compared with 16.3% of their HO herdmates. Furthermore, approximately 29% of both the 2-breed and 3-breed crossbreds lived beyond 45 mo after first calving compared with approximately 18% of their respective HO herdmates. On a lifetime basis, the 2-breed and 3-breed crossbreds provided +$122 and +$134, respectively, more cull cow revenue compared with their HO herdmates. For lifetime replacement cost, the 2-breed crossbreds did not differ from their HO herdmates; however, the 3-breed crossbreds had -$28 less lifetime replacement cost compared with their HO herdmates because of their younger age at first calving. The combined 2-breed crossbreds had +$0.473 (+13%) more daily profit (ignoring potential differences for feed efficiency) and the combined 3-breed crossbreds had +$0.342 (+9%) more daily profit compared with their respective HO herdmates. This resulted in +$173 more profit/cow annually for the combined 2-breed crossbreds and +$125 more profit/cow annually for the combined 3-breed crossbreds compared with their respective HO herdmates.

Effects of using non-conventional feedstuffs on the productivity and costs of egg farms in Ibadan, Nigeria

This study examines effects of privately producing layers mash by including such non-conventional feedstuff as cassava, brewers dried grain, etc on the productivity, cost and profit of poultry (eggs) farms. Primary data was collected from three categories of farms -12 "conventional feedstuff users" (CFU), 24 "non-conventional feedstuff users" (NCFU) and 10 Animal Care concentrate users" (ACCU) found in a sample survey of 46 private feed using farms in Egbeda and Lagelu Local Government area of Ibadan. Estimates of their production, total variable cost and profit functions obtained by ordinary least squares as well as analyses of variance conducted on their production and cost statistics revealed that no sufficient evidence exists to suggest that productivity levels differ across the three categories of farms, but NCFU significantly lower average cost and more profits per trm of eggs produced than the CFU. No sufficient evidence, however, exists to suggest that ACCU had any significantly different cost or profit per tray of eggs produced from those of CFU.

A structural mathematical model on two echelon supply chain system

As the people are becoming conscious about protection of the environment from pollutant caused by human beings, businesses are adopting green technology to procure green products to save the environment from pollution. Consequently, it is a challenging task at the firm manager to capture the market providing best green quality at fair price in a given economy. The paper plans to discuss two situations in two models. In model 1, the optimal green quality and sales prices of the manufacturer and the retailer in both decentralize and centralize systems of a two-echelon supply chain system are investigated. The profit functions of the manufacturer and the retailer include procurement costs, selling prices and cost for green level development and then it is analyzed by calculus method to obtain the optimal values of the decision variables. The model 2 focuses on price competition of two substitute products where demand of the end customers depends on price and quality of green product. Both the firms of green and regular products manufacturer are corporate social responsible. In this model, profit functions of the firms 1 & 2 are formulated separately considering revenues from sales items, cost of green quality and contribution for activities of social responsibility. The main objective is to find out optimal prices and green quality in order to maximize the profit functions of individual and integrated systems. The proposed models are analyzed mathematically and numerical examples are illustrated to justify the feasibility of the model in reality.

Profit Function Analysis of Aquaculture Farmers from Selected States in South East, Nigeria using Cobb –Douglas Stochastic Production Frontier Function

Profit function of aquaculture farmers from selected states in South East, Nigeria using Cobb –Douglas stochastic production frontier function was studied. One hundred and twenty farmers were selected using purposive and multi stage random sampling techniques. A structured questionnaire and oral interview were used to elicit information on primary data. The secondary data were collected using textbook, journals, seminars, workshops and other periodicals. Percentages responses, multiple regression model based on Stochastic Frontier Profit Function which assumed Cobb-Douglass specification form and Inefficiency function model, while Gross margin analysis multiple regression model based on Stochastic frontier profit function which assumed Cobb-Douglass specification form and Inefficiency function model and gross margin analysis were used to address the objectives of the study. The major results of the study showed that the coefficients of prices of feeds, fingerlings, drugs, fertilizer and pond size were positive. whereas, the coefficient of labour was negative and cut across all States, the coefficient of water was negative among Abia State farmers. Furthermore, the coefficients of age, educational levels, cooperatives and extension services were positive and cut across all States. Also, the coefficient of credit was negative and significance only in Anambra and Ebonyi States. The production of catfish and tilapia was profitable in the study area with high gross margin and Net farm income. The limitations to aquaculture production as well in the study areas were poor access to credit, water problem, poor fish breeds, poor access to extension services, high costs of building materials, feed and labour, and cannibalism. The need to improve farmers’ access to credit, extension services, good fish breeds among others were proffered.

A game theoretic approach for integrated pricing, lot-sizing and advertising decisions in a dual-channel supply chain

This paper discusses the coordination of pricing, lot-sizing and advertising policies in a dual-channel supply chain including one manufacturer and one retailer. The manufacturer produces one type of product and sells it to the retailer at wholesale price and also directly to consumers through direct channel. Consumers buy the product at retail price from the retailer and with direct sale price from the manufacturer. Demand depends on price and advertising efforts. Relationship between the manufacturer and the retailer has been modelled by two non-cooperative games of Nash and Stackelberg-retailer and one cooperative game. Finally, the change effect of the important parameters on the profit functions and the decision variables has been investigated. The results show that with increasing the cross-price sensitivity, the manufacturer's equilibrium profit for the two non-cooperative games increases. However, the increase in this parameter has no effect on the retailer's equilibrium profit.

MATLAB optimizacija proizvodne jedinice za preduzeće

This research work focused on how to maximize the profit of a mechanical manufacturing firm by optimizing the production units using MATLAB. This numerical analysis was manually done through the Simplex Method to model the production units into a linear mathematical equation that produces four major units which include standard aluminium spoon, bowl, pot and plates. Thereafter, a mathematical model was simulated using MATLAB2013b computational tool based on the previous input data of the mechanical firm and subjected to constraint equations based on the time required to finish each of the three products denoted p, q, r and s. The profit function was subsequently analysed to obtain the quantity of each product that will give maximum profit. The results of the manually calculated linear model corresponded with the MATLAB simulation that revealed that approximately <1 units, 17 units, 10 and 8 units of spoon, bowl, grinding teeth plate and pot respectively will have to be produced per day in order to obtain a maximum daily and monthly profit of #6,120.00 and #134,640.00. Businesses can thus be optimized and made more lucrative when resources and time available are allocated properly.

Preservation technology investment, trade credit and partial backordering model for a non-instantaneous deteriorating inventory

In a perfectly transparent and competitive market, suppliers must provide a competitive pricing and service for their customers. The aim of this study is to provide an insight into how preservation technology and credit financing could be used both to reduce the deterioration rate as well as to provide flexible financing for retailers. The methodology is to optimize the cycle length, selling price, the amount of preservation technology and credit financing using inventory theory. The result derived is an optimal total profit per unit time for the system. Finally, using MATLAB 2017a, it is shown graphically that the profit function is concave. The sensitivity analysis is illustrated using Lingo 17. The study not only provides insights to business managers in making wise managerial decisions, it also enables them to weigh the pro and con of implementing preservation technology and credit financing.

Macroeconomic Model with Monetary and Fiscal Policy and Externality: Nonlinear dynamics, Optimization and Control

Abstract Irregular fluctuations in economy lead to unpredictable effects and disrupt its stable functioning. Various tools could be used to stabilize irregular dynamics in economic models. For example, to introduce control into the model as an external function, as well as to take into account the internal characteristics of economic agents in the economy under consideration, we consider agents that use the variables that are under their control to achieve optimum, by minimizing or maximizing cost, profit, or welfare function. However, optimal behavior in economics does not necessarily lead to simple model dynamics. It is therefore important to find the conditions for and understand the mechanism of emergence of complex dynamics. We study two New Keynesian models, including one with externalitites, in continuous-time under different monetary and fiscal policy regimes, which represent the economy where the economic agents solve constrained optimization problems. We show that in case of explosive equilibrium dynamics, limit cycles or more complicated attracting sets could appear, including chaotic attractors of various nature. In this case it is possible to control irregular dynamics, including by adjusting policy parameters that serve as bifurcation parameters, in order to alleviate the implied economic uncertainty and bring agents’ expectations in line with the intended steady state.

Research on probability product differentiation based on power equilibrium

Overall the benefit of Supply Chain Based on probabilistic production and power equilibrium, the influencing factors of the decision-making of probabilistic productions are studied in this paper. Firstly, the correlation function of profit is formed by solving the lowest utility of products. Then numerical simulation and example research are carried out. The results show that, there is a positive correlation property between the two types of products which formed probabilistic production and supply chain efficiency. At the same time, manufacture and retailer should also pay attention to the proportion of the two types of products in order to achieve the best overall benefit. The conclusion in this paper has practical significance, it has a significant impact on the decision-making under the power equilibrium.

Economic Efficiency And Its Determinants In Chu-Mango Farming In The Mekong Delta, Vietnam

The paper employed a Cobb-Douglas stochastic frontier profit function to measure the level of economic efficiency (EE) and its determinants. The structured questionnaire was used to collect data from 522 of sampling observations (212, 171, and 139 observations for seasons 1, 2, and 3, respectively) randomly selected from designated locations in the Mekong Delta (MD). The study established a mean EE of 36.2%, 31.9%, and 35.9% in seasons 1, 2, and 3, respectively. The study identifiedthe land area and wrapping bag to be positively and significantly influencing on profit efficiency among three seasons. Besides, the results of the analysis indicated that labour price was important factor in season 3 at the 5% significance level, and price of the root fertiliser, leaf fertiliser and labour affected mainly on profit efficiency in season 2 at the 1% significance level. By contrast, the variable of the fungicide price in season 2, and the root fertiliser price in season 3 were negative factors on profit efficiency at the 1% significance level. Particularly, policy solutions were recommended that farmers should design Chu-mango gardens with appropriate trees density as well as encourage gardeners to use bags for wrapping mango fruits in farming in order to increase profit efficiency. Specially, Chu-mango growers should be empowered in land area acquisition to applied advanced technology in large-scale production more effectively.

Key Technologies of Cache and Computing in 5G Mobile Communication Network

The deployment of cache and computing resources in 5G mobile communication networks is considered as an important way to reduce network transmission delay and redundant content transmission and improve the efficiency of content distribution and network computing processing capacity, which has been widely concerned and recognized by academia and industry. Aiming at the development trend of cache and computing resource allocation in 5G mobile communication networks, in order to improve the efficiency of content cache and reduce network energy consumption, a 5G network cache optimization strategy based on Stackelberg game was proposed, which modeled network operators and content providers as multimaster and multislave Stackelberg game model. Providers buy base station storage space from network operators to cache popular content. In this paper, we construct the strategy space and profit function of the two sides of the game and prove the existence of Nash equilibrium solution among content providers given a set of base station rental prices of network operators. In this paper, distributed iterative algorithm is used to solve the game model, and the optimal base station pricing of network operators and the optimal base station occupancy rate of content providers are obtained.

Review of Direct Payments for Less-Favoured Areas: Evidence from Japan

Ministry of Agriculture, Forestry, and Fishery (MAFF) in Japan launched direct payment for hilly and mountainous areas considered as less-favored areas in 2000 with aim of preventing further farmland abandonment in the areas, compensating the farmers working in such disadvantaged regions for their costly production, and enhance agricultural multi-functionality through community cooperation. This review examines the effect of direct payments on continuous land use, prevention of farmland, agrarian structural change, environmental dimension, and income inequality through both quantitative and qualitative methods. Also, I connected the empirical results to theoretical economics using simple profit functions.

Analysis of a Variant Working Vacation Queue with Customer Impatience and Server Breakdowns

This paper analyses an infinite buffer single server variant working vacation queueing model in which the arriving customer may balk and the server is subject to breakdown. The service times during regular busy period and working vacation period, vacation times, breakdown times and repair times are assumed to be exponentially distributed and are mutually independent. In working vacation period, the customer may renege due to impatience. We derive the probability generating function of the steady-state probabilities and obtain the closed form expressions of the system size. In addition, we obtain some performance measures and a total expected profit function per unit time is designed to determine the optimal values at the maximum profit. We employ the particle swarm optimisation method to solve the profit optimisation problem.