Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
6896557 | European Journal of Operational Research | 2015 | 10 Pages |
Abstract
This paper considers a firm that introduces multiple generations of a product to the market at regular intervals. We assume that the firm has only a single production generation in the market at any time. To maximize the total profit within a given planning horizon, the firm needs to decide the optimal frequency to introduce new product generations, taking into account the trade-off between sales revenues and product development costs. We model the sales quantity of each generation as a function of the technical decay and installed base effects. We analytically examine the optimal frequency for introducing new product generations as a function of these parameters.
Keywords
Related Topics
Physical Sciences and Engineering
Computer Science
Computer Science (General)
Authors
Shuangqing Liao, Ralf W. Seifert,