Optimal Pricing Policy for Warranted Products

• Main Authors: Yi-Xiang Liao, 廖益祥
• Other Authors: Cheng-Kang Chen
• Format: Others
• Language: en_US
• Published: 2012
• Online Access: http://ndltd.ncl.edu.tw/handle/6h4w63

博士 === 國立臺灣科技大學 === 資訊管理系 === 100 === In a competitive market environment, the main strategic decision for a seller is determining a price schedule with respect to a specific marketing feature of the product. This paper investigates how a monopolistic seller can optimally determine the price schedule for a product with different warranty plans. By incorporating buyers' heterogeneous preferences on product warranty length, the pricing problem of a product for the seller is mathematically formulated. Four different pricing scenarios of warranted products under varies optimization objective are developed to specify the pricing problems for the seller. In each scenario, the optimal price schedule is derived such that the optimization objective is maximized by employing an optimal control approach. Finally, a numerical example is provided to illustrate the features of the proposed problem in each scenario and the sensitivity analyses of the parameters on the optimal solutions are also performed.