Capacity expansion with interrupted demand growth (Q1094323): Difference between revisions

From MaRDI portal
Importer (talk | contribs)
Created a new Item
 
Added link to MaRDI item.
links / mardi / namelinks / mardi / name
 

Revision as of 01:23, 31 January 2024

scientific article
Language Label Description Also known as
English
Capacity expansion with interrupted demand growth
scientific article

    Statements

    Capacity expansion with interrupted demand growth (English)
    0 references
    0 references
    0 references
    1988
    0 references
    In most long-range planning problems accurate forecasting of demand growth is often difficult. Sometimes unexpected shocks in the economy occur and disrupt the predicted growth rate of demand. For example, growth can unexpectedly cease for an indeterminate length of time due to crucial occurences such as wars, economic recessions or oil price shocks. In this paper, we examine the effects of unforeseen demand plateaus on the capacity expansion problem of sizing and timing production facilities. We assume that demand for capacity follows a stochastic process. That is, we allow for plateaus to happen at random future times and to continue for an uncertain duration. When the demand process is generated by an alternating renewal process, we show that demand plateaus result in a modified discounting rate and a modified import cost.
    0 references
    renewal processes
    0 references
    long-range planning
    0 references
    forecasting of demand growth
    0 references
    capacity expansion
    0 references
    sizing and timing production facilities
    0 references

    Identifiers