Structure of optimal policies in M/M/1 make-to-stock queues in the presence of partial control

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2015
Yenigün, Erkin
We study the structure of optimal pricing and batch acceptance policies for M/M/1 make-to-stock queue systems under complete and partial control. We model the problems as Markov decision processes under average gain criteria. The goal is to analyze how an exogenous basestock level affects the structure of optimal policies for both problems. Analyses show that both optimal pricing policy and optimal batch acceptance policy under complete control possess a monotone structure. In addition, we show that under certain conditions, prices quoted to customers and batch acceptance decisions under partial control possess a monotone structure for pricing and batch acceptance problems, respectively. Finally, we show that, for pricing problem, systems under complete control quote higher prices than those under partial control. For batch acceptance problem, systems under compete control reject a customer from a certain class earlier than systems under partial control.
Citation Formats
E. Yenigün, “Structure of optimal policies in M/M/1 make-to-stock queues in the presence of partial control,” M.S. - Master of Science, Middle East Technical University, 2015.