Double optimal stopping times and dynamic pricing problem: description of the mathematical model (Q2472187)

The authors consider the situation of dynamically pricing items the given stock of which has to be sold by a deadline. They assume that the demand is price sensitive and stochastic and that the objective is to maximize expected revenues. They address the problem of determining the optimal timing of double price changes from a given initial price to given lower or higher prices. The optimal policies are determined by thresholds in remaining time depending on the number of yet unsold items.