Hostname: page-component-76fb5796d-22dnz Total loading time: 0 Render date: 2024-04-28T10:21:31.529Z Has data issue: false hasContentIssue false

STOCHASTIC OPTIMAL CONTROL OF ATO SYSTEMS WITH BATCH ARRIVALS VIA DIFFUSION APPROXIMATION

Published online by Cambridge University Press:  08 August 2007

Wanyang Dai
Affiliation:
Department of Mathematics Nanjing University Nanjing 210093 People's Republic of China E-mail: nan5lu8@netra.nju.edu.cn
Qian Jiang
Affiliation:
Department of Mathematics Nanjing University Nanjing 210093 People's Republic of China E-mail: nan5lu8@netra.nju.edu.cn

Abstract

We study the stochastic optimal control for an assemble-to-order system with multiple products and components that arrive at the system in random batches and according to renewal reward processes. Our purpose is to maximize expected infinite-horizon discounted profit by selecting product prices, component production rates, and a dynamic sequencing rule for assembly. We refine the solution of some static planning problem and a discrete review policy to batch arrival environment and develop an asymptotically optimal policy for the system operating under heavy traffic, which indicates that the system can be approximated by a diffusion process and exhibits a state space collapse property.

Type
Research Article
Copyright
2007 Cambridge University Press

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)