Acknowledgments The authors would like to thank Midori Tanino and Ved Sud of the FAA for their support and encouragement. Within the Volpe Center, we would like to thank Dick Bair, Rick Oiesen and Ken Howard for reviewing the report and their valuable comments and suggestions that improved its content. We also thank Mary Costello for editing this report. The Enhanced Traffic Management System (...

T paper defines a unique type of product or service offering, termed probabilistic goods, and analyzes a novel selling strategy, termed probabilistic selling (PS). A probabilistic good is not a concrete product or service but an offer involving a probability of getting any one of a set of multiple distinct items. Under the probabilistic selling strategy, a multi-item seller creates probabilisti...

[Abstract] Federal Aviation Administration (FAA) air traffic flow management (TFM) decision-making is based primarily on a comparison of deterministic predictions of demand and capacity at National Airspace System (NAS) elements such as airports, fixes and enroute sectors. The current Traffic Flow Management System (TFMS) and its decisionsupport tools ignore the stochastic nature of the predict...

Probabilistic model; Inventory; Varying order cost; Holding cost; Lead-time demand; Uniform distribution; Safety stock Abstract This paper discusses the probabilistic backorders inventory system when the order cost unit is a function of the order quantity. Our objective is to minimize the expected annual total cost under a restriction on the expected annual holding cost when the lead time deman...