bluuebunny/crossref_metadata_2025 huggingface dataset:
Stochastic Programming with Aspiration or Fractile Criteria
Authors: Geoffrion Arthur M.
Published: November 2008

The general linear programming problem is considered in which the coefficients of the objective function to be maximized are assumed to be random variables with a known multinormal distribution. Three deterministic reformulations involve, respectively, maximizing the expected value, the α-fractile (α fixed, 0 < α < ½), and the probability of exceeding a predetermined level k of payoff. In this paper the author's previous work on “bi-criterion programs” is specialized to give an algorithm for routinely and efficiently solving the second and third reformulations. A by-product of the calculations in each case is the tradeoff-curve between the criterion being maximized and expected value. The intimate relationships between all three reformulations are illuminated, with the cumulative effect of considerably lessening the burden on the decision-maker to preselect with finality a particular value of α or k.
A Branch and Bound Algorithm for the Knapsack Problem
Authors: Kolesar Peter J.
Published: November 2008

A branch and bound algorithm for solution of the “knapsack problem,” max ∑ vixi where ∑ wixi ≦ W and xi = 0, 1, is presented which can obtain either optimal or approximate solutions. Some characteristics of the algorithm are discussed and computational experience is presented. Problems involving 50 items from which approximately 25 items were loaded were solved in an average of 0.07 minutes each by a coded version of this algorithm for the IBM 7094 computer.
Computational Experience with Variants of the Balas Algorithm Applied to the Selection of R&D Projects
Authors: Petersen Clifford C.
Published: November 2008

Allocating funds to independent R&D projects is a problem of practical importance for many firms. We formulate the problem as a 0-1 integer programming problem with the objective of selecting projects that will maximize the anticipated dollar contract volume, yet not exceed cost budgets. Our form-mulation accommodates R&D projects extending over several budget periods and permits carryover of unspent funds from one budget period to later periods. Experience in solving such problems by using the Balas [Balas, Egon. 1965. An additive algorithm for solving linear programs with zero-one variables. Oper. Res. 13 (4, July–August) 517–549.] algorithm in its literal form and in reformulated form is summarized. Several other modifications to the algorithm are described and; their effect on efficiency is shown through presentation of computational experience on problems with as many as 50 variables.
A Pareto-Optimal Dividend Policy
Authors: Wilson Robert
Published: November 2008

A Pareto-optimal sequential dividend policy for a syndicate is obtained in a tractable special case. The relationship between the many-person and single-person problems is investigated, and it is shown that the group acts as though it were an individual with risk preferences and probability assessments compounded from the members according to explicit formulae.
Evaluating a Call Option and Optimal Timing Strategy in the Stock Market
Authors: Taylor Howard M.
Published: November 2008

The optimal strategy for the holder of a “put” or “call” option contract in the stock market is studied under the random walk model for stock prices. Some results are distribution-free in that they depend only on the mean price change. Other results are derived under the assumption that price changes have a normal or Gaussian distribution. Under this assumption explicit results are obtained for the limiting case where the expiration date of the contract is indefinitely far in the future. Knowing the optimal strategy it is possible to evaluate whether the purchase of a given option can be expected to be profitable.
Allocation of Resources to Research Proposals
Authors: Hartmann Frederick , Moglewer Sidney
Published: November 2008

A model is presented for the allocation of company resources to research proposals. The approach is based upon the theory of games and focuses upon the uncertainties of contract funding and their effect on company policy. A general solution is derived for a game in which the payoff function for each proposal exhibits a diminishing return. An algorithm to obtain quick numerical solutions with a slide rule is also given. Data taken from the literature for the proposal activity of an aerospace company over a period of three years show good agreement between actual and calculated expenditures. Finally, the mini-max strategy used in two-person games is compared with policies based on other decision criteria and is shown to have a pivotal place in the planning process.
Critique of: “The Dynamic Synthesis Theory of Motivation”
Authors: Mjosund Arne
Published: November 2008

Comments on Gunn, B. 1968. The dynamic synthesis theory of motivation. Management Sci. 14(10, June) B-601–B-619.
Technological Change and Learning in the Computer Industry
Authors: Barr James L. , Knight Kenneth E.
Published: November 2008

Recent papers have introduced specific input variables in unrestricted Cobb-Douglas functions to define production relationships and obtain measures of technological change for industries and sector classifications.1 In a similar manner this paper incorporates the engineering, economic, and time aspects of the production process for the computer industry in several statistical models. The purpose of the study is to illustrate that technological change can be accounted for by specific innovations of the industry and that these measures can serve as measures of capital embodied technological change.
Steady State Solution of the Queue M/Ek/r
Authors: Mayhugh J. O. , Mccormick R. E.
Published: November 2008

The multiserver queue with Poisson arrivals and Erlangian, gamma or chi-square service time is solved for the steady state case. A general procedure, adaptable to computer programming, for writing the equations for the state probabilities is given. Generating functions for the time invariant state probabilities are found. A method of computing numerical solutions is described.
Observations & Opinions—Will Management Be Automated By 1975
Authors: Rader Louis T.
Published: November 2008

So, will management be automated by 1975? To the extent that automation means systems planning (and it does) the answer is yes. To the extent that automation means the utilization through investment of the latest machines to help do the required wok (and it does) the answer is yes. To the extent that automation means flexible and fast reaction to customer needs (and it does) the answer is yes. To the extent that automation means the utilization of mathematical techniques beyond that of simple arithmetic (and it does) the answer is yes. To the extent that automation means that all decisions can be made in advance; that people are not the most important ingredient in a business; that business judgment, skill and entrepreneurship are not needed (and it does not mean these things), management will not be automated by 1975 or ever.
Communications to the Editor—A Note on the Shapley Value
Authors: Owen Guillermo
Published: November 2008

In Shapley, L. S. 1953. Additive and non-additive set functions. Ph.D. thesis, Department of Mathematics, Princeton University, Shapley considers a modification of his power index. The modified values are introduced via special weights. This note suggests that those weights should be thought of as coefficients of slowness to reach decision.
Communications to the Editor—A Stochastic Bottleneck Assignment Problem
Authors: Yechiali Uri
Published: November 2008

Consider an n-job stochastic bottleneck assignment problem in which the production rates are independent random variables rather than constants. Assume that the production rate, Rij, (Rij ≧ 0; i, j = 1, 2, …, n) of man i when assigned to job j is: (1) exponentially distributed with mean 1/λij or (2) Weibull distributed with scale parameter λij and shape parameter β. It is shown that in either case, the assignment that maximizes the expected rate of the entire line is found by solving the deterministic assignment problem with “cost” matrix [λij].
Competitive Organizational Structures in Coupled Markets
Authors: Shakun Melvin F.
Published: November 2008

The effect of different company organizational structures (as centralized and decentralized) on competition in coupled markets is studied using a game theory approach. By coupling it is meant that management actions taken in the market for one product have an effect on the market for another. A specific example is where advertising dollars spent in generating sales for one product have an influence on the sales of another product. In some cases competition between companies in coupled markets takes the form of a Prisoner's Dilemma and may be discussed in terms of recent research findings on this game. Various other aspects of research on competitive organizational structures in coupled markets are discussed.
Implementation of Management Science in Latin America: A Case Study and Generalization
Authors: Loomba N. Paul , Turban Efraim , Cohen Alvin
Published: November 2008

Private and public programs designed for rapid industrialization and for raising living standards have caused a growing demand in Latin America for persons trained in management science. Current sources for such training include special “productivity centers,” departments or institutes of management science at various Latin American universities, technical personnel of North American firms, and professional academicians of North American educational institutions. If the level of private business between North and South America increases, it would be quite reasonable for North American firms to assume a greater responsibility for the transfer of management science techniques to Latin America.

This paper describes an actual case study of the application of management science to the business and operational problems of a Latin American meat processing firm. Located in Paraguay, the firm is a subsidiary of a large multi-management company—Ogden Corporation. In conjunction with the local management, the study was conducted by Ogden's department of Operations Research. The following aspects of the Latin American firm were analyzed for possible application of management science techniques: (1) organization structure, (2) ranch operations, (3) product mix problems, (4) investment analysis, and (5) inventory control.

Based on Ogden's experiences in a typical Latin American business setting, we attempt here to describe some of the present problems and the future potential for management science applications in Latin America. Major problems of implementation identified in this case and considered typical to Latin America are: (1) lack of qualified personnel, (2) lack of EDP facilities, and (3) existence of traditional cultural and political barriers to scientific approaches. However, because of a rising technological function, management science application offers a fertile territory in Latin America.
A Criterion for Investing in Information
Authors: Owen Joel
Published: November 2008

As the amount of money invoiced in a decision rises, so does the burden of making the decision. Thus, it is not surprising or rare that the question arises: should a study be instituted before the decision is made to lessen the risks involved? Of course, such a study will itself cost something depending on the cost of analyzing data, the number of people involved and the value of the information gathered. The decision maker is then confronted with two courses of action, to make a decision based on existing information or to institute a study program, i.e., to invest in information before making a decision. In this paper we develop a procedure by which the decision maker can choose between these alternatives.
Critique of: “The Engineering and Management of an Effective System”
Authors: Sasieni M. W.
Published: November 2008

Critique of Feigenbaum, D. S. 1968. The engineering and management of an effective system. Management Sci. 14(12, August) B-721–B-730.
Blast Furnace Production Planning—A Linear Programming Example
Authors: Fabian Tibor
Published: November 2008

A description of the blast furnace production process is presented and the thermochemical metallurigcal process is expressed as a set of constraints of a linear programming problem. The solution indicates a minimum cost selection of input materials in a production planning context. The material presented here is dedicated to those who are engaged in the mathematical modelling of chemical and other complex processes for purposes of management control. It is also hoped that by adding the paper to the literature of detailed examples, a case study, often desired for classroom instruction, will be provided to educators.
Critique of: “Verification of Computer Simulation Models”
Authors: Mckenney James L.
Published: November 2008

Critique of Naylor, T. H., J. M. Finger. 1967. Verification of computer simulation models. Management Sci. 14 (2, October) B-92–B-101.
Managerial Perceptions of Organizational Effectiveness
Authors: Mahoney Thomas A.
Published: November 2008

Perceptions and judgments of 84 managers were analyzed in the development of models of organisational effectiveness applied in managerial judgments. Managers described 283 subordinate organization units in terms of 114 variables often mentioned as indicative of organizational effectiveness. Managers also made judgments of the overall effectiveness of these organizations. Analysis of the descriptions indicated that the 114 variables reflect 24 basic dimensions of organizational effectiveness. Models predictive of managerial judgments of organizational effectiveness were developed using these 24 dimensions. A general model accounted for 56 per cent of the variance of judgments of overall effectiveness made by the 84 managers. Other models developed for more homogeneous sub-samples of managers accounted for 75 to 85 per cent of the variance in judgments of overall effectiveness. These models typically involve only seven of the 24 dimensions of organizational effectiveness with a single dimension carrying the most weight in judgments. These models of managerial judgments of organisational effectiveness identify the basic dimensions viewed by managers in judging subordinate organizations and the relative weights assigned them. As such, they provide a useful framework for the development of criteria for judging organizations for administrative and research applications.
Verification of Computer Simulation Models
Authors: Naylor Thomas H. , Finger J. M.
Published: November 2008

The problem of validating computer simulation models of industrial systems has received only limited attention in the management science literature. The purpose of this paper is to consider the problem of validating computer models in the light of contemporary thought in the fields of philosophy of science, economic theory, and statistics. In order to achieve this goal we have attempted to gather together and present some of the ideas of scientific philosophers, economists, statisticians, and practitioners in the field of simulation which are relevant to the problem of verifying simulation models. We have paid particular attention to the writings of economists who have been concerned with testing the validity of economic models. Among the questions which we shall consider are included: What does it mean to verify a computer model of an industrial system? Are there any differences between the verification of computer models and the verification of other types of models? If so, what are some of these differences? Also considered are a number of measures and techniques for testing the “goodness of fit” of time series generated by computer models to observed historical series.
Optimal Production Scheduling and Employment Smoothing with Deterministic Demands
Authors: Lippman Steven A. , Rolfe Alan J. , Wagner Harvey M. , Yuan John S. C.
Published: November 2008

In this paper we study a model that minimizes the sum of production, employment smoothing, and inventory costs subject to a schedule of known demand requirements over a finite time horizon. The three instrumental variables are work force producing at regular-time, work force producing on overtime, and the total work force. Overtime is limited to be not more than a fixed multiple of regular time. The idle portion of the work force and the levels of inventory are resultant variables. We postulate the following shape characteristics for the cost functions production costs are convex-like, smoothing costs are V-shaped, and holding costs are increasing, both the production and holding cost functions need not be stationary. In this paper, we provide upper and lower bounds on the cumulative regular-time plus overtime work force for any sequence of demand requirements. We also give the form of an optimal policy when demands are monotone (either increasing or decreasing). Finally, we derive the asymptotic behavior of optimal policies when demands are monotone and the planning horizon becomes arbitrarily long. All of these results, which convey information about the numerical values of optimal policies, given specific demands and an initial level of inventory, depend only on the shape characteristics of the cost functions. Algorithmic techniques are discussed elsewhere [Lippman, S. A., A. J. Rolfe, H. M. Wagner, J. S. C. Yuan. Algorithms for optimal production scheduling and employment smoothing. Opns Res. To appear.], [Yuan, J. S. C. 1967. Algorithms and multi-product model in production scheduling and employment smoothing. Technical Report 22 (NSF GS-552), Stanford University, August.].
Regional Rain Models with Space- and Time-Correlated Structure
Authors: Sorensen Eric E.
Published: November 2008

Many activities combining the interactions between man and machine are influenced by a third factor of weather. The sensitivity analysis required to explore the complicated effects of weather is important in evaluating situations when man-machine strategies are constructed to arrive at optimal operations. The influence of rain on the harvesting of crops is one such situation. A generalized model has been constructed which will simulate rainfall over regions containing gradient extremes of annual rainfall of 5 inches to 50 inches within the region for any given year.

The specific application covered a region 5 miles by 14 miles. We believe that much larger regions can be represented in the same manner.

The model will generate daily rain patterns of a spatial and temporal sequence correlated from over a large number of sub areas (fields or farms) within the region. Daily isohyets (equal rainfall contour lines) can be constructed from simulated computer periods of an unlimited time horizon. The model can interact with other models (for example, harvesting and irrigation models) in order to analyze the sensitivity of these models to rainfall incidence, rainfall severity and duration.
Communications to the Editor—Improvement on Gutjahr and Nemhauser's Algorithm for the Line Balancing Problem
Authors: Mansoor E. M.
Published: November 2008

Improvements to the paper Gutjahr, A. L., G. L. Nemhauser. An algorithm for the line balancing problem. Management Sci. 11(2) 308–315.
Errata
Authors: Martos Bela
Published: November 2008

Erratum to B. Martos, “The Direct Power of Adjacent Vertex Programming Methods,” Management Science, 12 3, pp. 241–252.
Erratum
Authors: Demetriou Peter A.
Published: November 2008

Erratum to Peter A. Demetriou, “The Present Value of Investments in Sinking Funds,” Management Science, 13 5, pp. 336–343.
Intuition and Relevance
Authors: Morris William T.
Published: November 2008

The problem of the relevance of the analytical products of management science for the manager whose decision making is largely intuitive is discussed. A definition of intuitive behavior is proposed based on the willingness of the manager to use a particular verbalization of his decision process as a basis for delegating the decision to a particular recipient. The possibility of involving the manager in a series of experiments aimed at enhancing this willingness to delegate is suggested. Effective intuitive behavior is taken to be characteristic of both experienced managers and experienced scientists. Some hypotheses concerning the process of developing the intuitive abilities of inexperienced persons are raised.
A Model for Production-Distribution Networks with Transit Billing
Authors: Meyer Carl F.
Published: November 2008

The model presented in this paper uses the method of linear programming to solve multi-plant, multi-product distribution networks constrained by plant production schedules and manufacturing combinations when the shipment of final goods is a function of the raw material input. This function connecting inbound material with outbound finished goods at a given production facility is described by the privilege of mill-in-transit granted by the material haulers. The model is developed under very general assumptions, and is able to solve the networks in terms of optimally applying transit billing, determining production schedules and combinations, and final distribution of product to customer while allowing for outside purchases of the same end products.
Critique of: “Ranking Procedures and Subjective Probability Distributions”
Authors: Green Paul E.
Published: November 2008

Lee Smith's paper (Smith, L. H. 1967. Ranking procedures and subjective probability distributions. Management Sci. 14 (4, December) B-236–B-249.) is interesting as much for the questions he raises as for the answer he proposes. Those of us who have tried to elicit subjective probability distributions in the context of corporate systems can sympathize with his position that no “objective” way has yet been proposed. It is no wonder that the procedures which he cites as precursors to his proposal are ad hoc and, shall we say, “flexible.” The main issue, however, is whether the procedure advocated in his paper overcomes the limitations of previous devices. Related questions concern: (a) the compatability of probabilistic thinking with the culture of line management; and (b) the accuracy of the elicited judgments, using the “best” of methods.
Information Structures in Stochastic Programming Problems
Authors: Miyasawa Koichi
Published: November 2008

Problems of multi-stage decision under uncertainty are usually classified into “stochastic” and “adaptive” ones, depending on whether the decision maker does or does not know the relevant probability distribution. If the Bayesian approach is taken, then, in the adaptive case, the decision maker is assumed to know the prior distribution of certain parameters. It is shown in the paper that the adaptive case is then reducible to the stochastic one.

The problems can also be classified according to the kind of information (memory) available to the decision maker. In the paper, optimal policies and the expected gains they yield, are determined for some important classes of “information structures.” In cases in which added information does not increase the expected gain, a sufficient information structure is specified.
Turnpike Planning Horizons for a Markovian Decision Model
Authors: Shapiro Jeremy F.
Published: November 2008

This paper establishes some asymptotic properties of the finite state and action space Markovian decision model. For the discounted case, a turnpike theorem is proven which states that an optimal immediate decision when the planning horizon is sufficiently large is to choose one of the decisions which is optimal when the planning horizon is infinite. An upper bound on how large is sufficiently large is given. An asymptotic property of the model for discount factors in a neighborhood of one is also developed.
Golden Block Search for the Maximum of Unimodal Functions
Authors: Avriel Mordecai , Wilde Douglass J.
Published: November 2008

In a previous paper [Avriel, M., D. J. Wilde. 1966. Optimal search for a maximum with sequences of simultaneous function evaluations. Management Sci. 12 722.], the authors presented the minimax block search strategy for locating the maximum of unimodal functions of one variable by a sequence of simultaneous function evaluations. In the present work the nearly optimal minimax golden block search method is developed which has the advantage that the number of function evaluations need not be specified in advance. For one experiment per block it reduces to the well known golden section method. It is shown that this method is an excellent approximation of the block search strategy and that for a certain marginal resolution the two methods become identical.
A Markovian Analysis of the Life of Newspaper Subscriptions
Authors: Deming W. Edwards , Glasser Gerald J.
Published: November 2008

This paper presents a case study in the application of some statistical theory, and a mathematical model, to an actual business problem. The problem was to determine the pattern of mortality of subscriptions to a daily newspaper, and thereby to ascertain the average life of such subscriptions. The method of solution, here with indicated, involved the collection of data from a probability sample of subscribers to the newspaper, and use of these data to construct a Markov chain.
Maximizing Insurance Buyers' Utility
Authors: Hamburg Morris , Matlack William F.
Published: November 2008

This paper presents a normative analysis of the purchase of insurance by deducing decision rules for the purchase of the correct amounts and kinds of insurance by consumers. The merits of different types of insurance policies are evaluated in terms of consumers who possess concave downward quadratic utility functions. Such consumers represent one class of risk-avoiders in the classical sense of making choices under uncertainty which indicate diminishing marginal utilities for money.
The Effect of Worker Productivity on Production Smoothing
Authors: Orrbeck M. G. , Schuette D. R. , Thompson H. E.
Published: November 2008

In this paper the assumptions of constant wages and productivity in the production smoothing problem are dropped in favor of a model which explicitly treats changes in them through employee experience. The model is an extension of the Hanssmann-Hess model and hence the necessary transformation to convert the problem into linear programming format are provided. Finally some numerical calculations are made to illustrate the use of the model. These calculations suggest that when the difference in productivity between old and new workers is quite large, as would be the case in a skilled-labor-intensive industry, the extended model represents a substantial improvement over the original Hanssmann-Hess model.
A Search Decision Rule for the Aggregate Scheduling Problem
Authors: Taubert William H.
Published: November 2008

This paper proposes a search decision rule (SDR) approach to the aggregate scheduling problem. The approach is tested by converting the objective function of the classic Holt, Modigliani, Muth and Simon paint factory scheduling problem into a 20 dimension response surface which is then explored by the SDR. Conjugate gradient, variable metric and pattern search methods are tested. All three methods demonstrate the ability to consistently descend to the neighborhood of the minimum. The pattern search technique is selected for incorporation into the SDR heuristic because of its excellent performance in terms of reducing the computation time required. Production and work force decisions made up by the SDR are comparable to those made by the linear decision rule and total costs are within 0.1%. By means of the search decision rule approach it should be possible to eliminate the restrictions imposed by linear and quadratic cost models and thereby pursue a more general and realistic approach to the aggregate scheduling problem.
The Implementation of Process Models
Authors: Fiore C. F. , Rozwadowski R. T.
Published: November 2008

The article focuses attention on the problems encountered in formulating and using process mathematical models in an industrial environment. A model of an actual lime factory is used for descriptive purposes. The linear programming technique is employed to illustrate the simulation of the plant. The paper does not try to explain the mathematics of linear programming or any other technique used to simulate the activities of a plant. The aim of the writers is rather to outline the steps taken in formulating a plant model and what can be done with it. This paper is mainly concerned, therefore, with the managerial, engineering and cost accounting problems encountered. The linear programming technique is applied here mainly because of its wide range of applications. Much of what is described may be of value to persons using other methods.
Critique of: “Management Science in University Operation”
Authors: Dean Burton V.
Published: November 2008

Critique of Rath, G. J. 1968. Management science in university operation. Management Sci. 14(6, February) B-373–B-384.
Critique of: “Management Science in University Operation”
Authors: Griffin Marvin A.
Published: November 2008

Critique of Rath, G. J. 1968. Management science in university operation. Management Sci. 14(6, February) B-373–B-384.
Separable Markovian Decision Problems
Authors: Denardo Eric V.
Published: November 2008

The special structure of a class of Markovian decision problems is exploited to simplify the determination of optimum policies. For certain pairs consisting of a state i and decision k, the cost cki separates (cki = ai + bk), while the transition probabilities pkij and transition time distributions Fkij are independent of i. Equivalence of a second Markovian decision problem which exploits this structure is demonstrated for the discounted and averaging cases. In addition, streamlined approaches are presented for dealing directly with the original problem, and a particular inventory model is further simplified.
Sales and Restocking Policies in a Single Item Inventory System
Authors: Evans Richard V.
Published: November 2008

A single product system with linear costs is considered when customers are of two different types. Penalty costs for lost sales differ for the two types of customers and; therefore, optimal system control requires different shortage probabilities for the two classes. In one case, high penalty customers independently arrive while at the other extreme it is assumed that there is only one such customer. Single critical number policies are optimal in the simple situations. If the priority type customers become active and register displeasure by changing their demand pattern when their demands are not satisfied, simple convexity or Polya frequency function arguments are not sufficient to guarantee that the optimal policy remains one of the single critical number variety.
Communication to the Editor—An Equilibrium Property of Finite-Population Queues
Authors: Schweitzer Paul J.
Published: November 2008

The purpose of this note is to extend, by means of a somewhat simpler derivation, a result of Sherbrooke [Sherbrooke, C. C. 1966. Generalization of a queueing theorem of palm to finite populations. Management Sci. 12(11, July) 907–908.] to the case of arbitrary arrival distributions, arbitrary in the sense that customers are distinguishable and may have different density functions of holding time and interarrival time.
A New Product Analysis and Decision Model
Authors: Urban Glen L.
Published: November 2008

The decision to add, or to reject, or to investigate more fully a new product proposal is one of the most important problems faced by businessmen. The factors surrounding the decision can be mathematically considered by four sub-models in the areas of demand, cost, profit, and uncertainty. The demand model is structured to consider life cycle, industry, competitive and product interdependency effects, and will admit non-linear and discontinuous functions. A cost minimization model is joined to the demand model to formulate a constrained profit maximization problem. The optimization is accomplished by the use of dynamic programming. The final decision is based on the businessman's criterion in combining uncertainty and the rate of return on investment. A practical application of the model is presented to demonstrate the usefulness and problems of a quantitative approach to new product decisions.
Demon, Mark II: An Extremal Equation Approach to New Product Marketing
Authors: Charnes A. , Cooper W. W. , Devoe J. K. , Learner D. B.
Published: November 2008

Numerous alternatives are available in the kinds of studies which can be elected in the market research which should precede the introduction of a new product. This gives rise to a possible network interpretation and treatment by an associated chance-constrained programming characterization and analysis. The resulting model, called DEMON (Decision Mapping Via Optimum GO-NO Networks), which was discussed in [Charnes, A., W. W. Cooper, J. K. DeVoe, D. B. Learner. DEMON: Decision mapping via optimum GO-NO networks—A model for marketing new products. Management Sci. 12(11) 865–877.], is here given a new formulation in terms of an extremal equation. A general analytic characterization is achieved and then replaced by more special ones. Means for effecting study decisions and inferences are discussed along with the sensitivity analyses that we associate with GO and NO preemptions, relative to profit and payback constraints. Payback (in a constraint) is here distinguished from its use as a criterion for choice (or objective), the latter being here oriented toward MEMP (maximizing expected maximum profit). A chart is provided for interpreting these and other aspects of policy which bear on the problems of marketing a new product.
Comments on Professor Forrester's“Industrial Dynamics—After The First Decade”
Authors: Ansoff H. Igor , Slevin Dennis P.
Published: November 2008

Comments on Forrester, J. W. 1968. Industrial dynamics—After the first decade. Management Sci. 14(7, March) 398–415.
Optimization and Suboptimization: The Method of Extended Models in the Non-Linear Case
Authors: Bessiere F. , Sautter E. A.
Published: November 2008

Let us consider some particular optimization problem. Most of ita data is determined by the economic “environment”. However, this environment is evolutive, and may be the subject of an optimization research. The particular problem first considered then appears to be a suboptimization, and its results will be valid only if it is separable from its environment.

This point of view can be expressed in mathematical terms by considering a “principal” programming problem from which one tries to separate a “reduced” subproblem. The concept of “separability” is defined and studied in the first part of this paper. In the second part, it is used to justify the “Method of Extended Models” as a tool for building optimization models.
An n Job, One Machine Sequencing Algorithm for Minimizing the Number of Late Jobs
Authors: Moore J. Michael
Published: November 2008

An algorithm, computationally feasible for large problems, has been formulated for sequencing n jobs through a single facility to minimize the number of late jobs. This algorithm is then extended to solve the problem in which each job is associated with a continuous, monotone non-decreasing deferral cost function. The object is to produce a schedule where the maximum deferral cost incurred is minimal.
Probability of Survival as an Investment Criterion
Authors: Hanssmann Fred
Published: November 2008

Suppose that an investing firm is primarily interested in achieving a specified minimum return critical to its economic survival. Then it seems appropriate to maximize the probability of exceeding the aspiration level. This decision criterion will be applied in the context of several stochastic static investment models with budget constraint. As long as the aspiration level does not exceed the maximum expected return achievable with the given budget, the desired investment strategy must be sought among the efficient solutions in the Markowitz sense. For higher aspiration levels this is no longer true. For the special case of the Markowitz model we show that all investment projects with expected yield not exceeding the aspiration level (of yield) should be rejected. This is a surprising confirmation of a well-known deterministic rule of investment theory and practice in a rather different context.
Discrete Stochastic Programming
Authors: Cocks K. D.
Published: November 2008

A method is presented for solving linear programming problems where (any number of) the functional, restraint, and input-output coefficients are subject to discrete; probability distributions. The objective function is formulated in terms of variance and/or expectation.

The procedure involves the simultaneous generation of all (mutually exclusive) possible outcomes and hence the transference of all variability into the objective function of a very much enlarged linear program.
Free For All—Guest Editorial: Social Change and the “Evaluative Function” in Government
Authors: Golovin Nicholas E.
Published: November 2008

In searches for rational policy alternatives concerning circumscribed sectors of governmental activity it is sometimes difficult to reach satisfactory conclusions without expanding the “universe of discourse.” And, the broader the sector and/or the higher the level of government, the more likely it is that useful results will not be obtained without viewing at least some of the aspects of the problem of interest from a national or more general point of view. Thus, during the writer's involvement with apparently well delimited problems in the management of federal research and development programs, efforts to develop rationales for decisions about program priorities invariably resulted in need to dispose first of questions falling outside the terms of reference for the issues at hand. The concepts of an “evaluative function” and, specifically, of an “evaluative branch” of government, arose in the course of attempts to overcome this difficulty. And, in exploring some of their implications beyond the confines of science and technology, it became apparent that applications promised improvement in governmental and private sector capabilities for dealing, at least theoretically, with a number of socio-economic problems now concerning the several levels of government in the United States.
Operational Gaming Simulation with Application to a Stock Market
Authors: Barish Norman N. , Siff Frederick H.
Published: November 2008

This paper presents a concept of operational gaming with important new features and describes its implementation. One of these new features is the incorporation in the model of computer generated play whose character is determined by the action of the players as well as computer programmed stochastic characteristics. The paper

1. Presents the concept of operational gaming simulation and its potential usefulness.

2. Describes what has been done to implement this concept in one area of application for economic research and instruction.

3. Pictures this application to a stock market in sufficient detail so that persons who might be interested in using this model for research and/or instructional purposes are aware of its nature and availability.

The development of the model into a usable instrument is described and the procedures being used to give it realism and validity are discussed during the course of this presentation.
Statistical Decision Models for Brokering
Authors: Bracken Jerome , Soland Richard M.
Published: November 2008

Statistical decision models are formulated for a decision situation involving a decision maker who is a broker, a person engaged in bringing together sellers and buyers to make transactions. The objective of the analysis is the determination of a plan in accordance with the broker's subjective estimates which can serve as a guide for optimally allocating his energies.
Duality in Markov Decision Problems with Countable Action and State Spaces
Authors: Evans John P.
Published: November 2008

The recent literature contains several papers which explore mathematical programming formulations of particular Markov sequential decision problems. Each of these papers deals with finite state and action spaces; thus, the corresponding programming formulations yield dual finite linear programs. In this paper these investigations are extended to include countable action and/or state spaces for finite horison problems. Of particular interest are the duality aspects of the mathematical programming formulations. In addition, employing conditions analogous to fundamental concepts of Haar semi-infinite dual programming, we provide sufficient conditions for the existence of optimal rules for countable action spaces. Guided by the semi-infinite duality theory we explore mathematical programming formulations for two cases: 1) Countable action space and finite state space—the result is a pair of dual semi-infinite programs; and 2) Finite action space and countable state space—we obtain a pair of infinite programs. In the latter case we show that no duality gap occurs and obtain duality results comparable to those of finite linear programming.
A Time-Sharing Queue
Authors: Adiri I. , Avi-Itzhak B.
Published: November 2008

The paper investigates in detail a single server single queue time-sharing system with homogeneous Poisson arrivals and exponentially distributed service times. The important variables affecting the design and operation of the system were investigated, and the results are given in terms of steady-state expectations and distribution transforms. An attempt is made to demonstrate the influence of various systems's parameters on the overall performance. Special attention is given to optimisation with respect to quantum size. It is hoped that some of the results may serve as guidelines in the design and operation of time-sharing systems.
Queuing Analysis of Real-Time Computer Processing
Authors: Chang W.
Published: November 2008

Recently the development of the real-time environment has influenced the design and altered the concepts of computer oriented systems. A priority queuing model was developed to analyse the performance of a simple real-time computer system. The jobs come from remoted stations and form a Poisson process. Each job consists of two tasks: the communication task which is placed in the high priority queue, and a processing task which is executed by the computer on an available basis. The stationary queue length and the waiting time distributions are investigated.
Optimal Ordering Policies for a Continuous Time, Deterministic Inventory Model
Authors: Falkner Charles H.
Published: November 2008

A deterministic, continuous time, nonstationary inventory model is formulated to find the number of orders, the order quantities, and the times at which orders should be placed which minimize the total cost over a finite time horizon of meeting a given requirements function. Both backlogging and no backlogging are considered. Conditions are given for the existence of an optimal policy with a regeneration point property which permits the order quantities to be calculated from the requirements function. The conditions for an optimal policy permit the use of a purchase cost function providing for quantity discounts. Two examples are considered.
Minimizing Customer Line Items Backordered in Inventory Control
Authors: Hausman Warren H.
Published: November 2008

This paper considers the theory and application of an alternative measure of stock-out cost in inventory control. Instead of recording the number of units of a product which are backordered, in certain situations it is appropriate to focus on the number or percentage of customer line items (requests for a particular item) which are backordered. By combining an approximate backorder cost per customer line item backordered with the usual ordering and carrying costs, an approximately optimal reorder point (or safety stock) formula is derived. The formula is applied to a stratified sample of 500 products from an actual inventory system, and an estimated 13% reduction in customer line items backordered is obtained with no increase in total inventory investment.
Investment Analysis Under Uncertainty
Authors: Wilson Robert
Published: November 2008

Investment projects are described in this paper as a pattern of uncertain cash flows over time; i.e., as a cash flow pattern over an event tree. Whereas the portfolio problem of selecting projects generally requires simultaneous consideration of all available projects, here we seek sufficient conditions for accepting and rejecting individual projects. These conditions are formulated as mathematical programming problems which are amenable to routine application at subordinate levels of an organization.

“Investment is, in essence, present sacrifice for future benefit. But the present is relatively well known, whereas the future is always an enigma. Investment is also, therefore, certain sacrifice for uncertain benefit.”1
Solving Production Smoothing Problems
Authors: Galbraith Jay R.
Published: November 2008

This paper analyzes the problem of balancing resource capacity utilization against the costs of user delay or inventory investment. Instead of formulating algorithms to solve more classical versions of the problem, this paper describes ways that organisations can drop the cost curve prior to applying an optimizing algorithm. This is done by classifying the techniques and giving examples from organizations which have faced serious smoothing problems. Other organizations can improve their cost performance by adopting some of these techniques.
A Financial Simulation for Risk Analysis of a Proposed Subsidiary
Authors: Economos A. M.
Published: November 2008

This paper describes a model for a computer stimulation designed to analyze and forecast the financial posture of a computer leasing company as a subsidiary to a large corporation.

The simulation considers the rate of market growth, the year of the introduction of fourth generation hardware and the year that the computer manufacturers act to impede the growth of the leasing industry, as random variables. Other assumptions are input as equations or constants. Financial analyses are performed during a five year simulation period. The means and the 10% and 90% quantile range for several key financial indicators are determined and plotted.
The Consensus of Subjective Probability Distributions
Authors: Winkler Robert L.
Published: November 2008

“‘But we can't agree whether A or B is correct,' he concluded, ‘and so we're collecting expert opinions, weighting them appropriately, and programming WESCAC to arbitrate the whole question.’” (John Barth, Giles Goat-Boy, p. 664.)

In the Bayesian framework, quantified judgments about uncertainty are an indispensable input to methods of statistical inference and decision. If a decision maker has little knowledge with regard to the parameters of interest, he may decide to consult a number of experts and obtain their quantified judgments in the form of subjective probability distributions. If this is the case, the decision maker must somehow combine the distributions assessed by the experts and form a single distribution to be used as an input to a formal Bayesian analysis. Several methods for combining the distributions are suggested, some involving mathematical formulae and some involving feedback and/or group discussion. These methods are compared under certain assumptions regarding the form of the distributions and also under experimental conditions.