Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
1142662 | Operations Research Letters | 2013 | 5 Pages |
Abstract
We consider the problem of selling a fixed stock of items over a finite horizon when the buyers arrive following a Poisson process. We obtain a general lower bound on the performance of using a fixed price rather than dynamically adjusting the price. The bound is 63.21% for one unit of inventory, and it improves as the inventory increases. For the one-unit case, we also obtain tight bounds: 89.85% for the constant-elasticity and 96.93% for the linear price-response functions.
Related Topics
Physical Sciences and Engineering
Mathematics
Discrete Mathematics and Combinatorics
Authors
Alper Şen,