Relations between cells in cellular manufacturing

The paper considers a (static) portfolio system that satisfies adding-up contraints and the gross substitution theorem. The paper shows the relationship of the two conditions to the weak dominant diagonal property of the matrix of interest rate elasticities. This enables to investigate the impact of simultaneous changes in interest rates on the asset demands.

Bullwhip reduction for ARMA demand: The proportional order-up-to policy versus the full-state-feedback policy

A 'proportional' order-up-to policy reacting to ARMA demand is analyzed using stochastic optimal control theory. This policy is compared with a full-state-feedback order-up-to policy. Necessary conditions for an optimum of a weighted sum of the inventory and the ordering variances for both policies are formulated. Based on this a relatively simple expression for the 'full-state' policy is derived. The comparison between the two policies demonstrates that the 'intuitively' designed proportional policy does not fulfill the objective of controlling both the inventory and ordering variance for all parameter values of the demand model as well as the full-state-feedback policy. The full-state-feedback policy outperforms the proportional policy in several aspects. (c) 2006 Elsevier Ltd. All rights reserved