Optimal Designofa Process-Inventory Network Under Infrequent Shutdowns

Optimal market making strategies under inventory constraints

We study the problem of a market-maker acting as a liquidity provider by continuously setting bid and ask prices for an illiquid asset. We assume that the market maker has a contractual obligation to permanently quote bid and ask prices for the security and therefore to satisfy any sell or buy order from the asset’s investors. On the opposite side of the trades, there are investors who act as l...

A Stochastic Inventory Approach for Optimal Planning of Flexible Process Networks under Uncertainty

Due to global competition and dynamic market environment, a major challenge in enterprisewide optimization [1-3] has become to simultaneously optimize the production planning and inventory control decisions for chemical complexes under demand and supply uncertainty [4, 5]. Because chemical complexes are usually composed of many interconnected processes and various chemicals, it is an important ...

Optimal Inventory Policies under Stochastic Production and Demand Rates

We consider a single stage production-inventory system whose production and demand rates are modulated by an environment process modeled as a finite state Continuous Time Markov Chain (CTMC). When the inventory level reaches zero, an order is placed from an external supplier, and it arrives instantaneously. We derive an Economic Order Quantity (EOQ ) policy that minimizes the long-run average c...

Optimal Inventory Policies for Assembly Systems Under Random Demands

Optimal Production-Inventory Policy under Energy Buy-Back Program

This paper proposes a production-inventory model with setup cost for production and financial compensation for stopping production when the buy-back program is activated, which is a modified model to that of [Chen et al 2007] by including the setup cost. Under an energy buyback program, we consider M+1 types of market scenarios and the corresponding buy-back levels with different financial comp...