Changes in product quality and consumer responses

Groen, L

Changes in product quality and consumer responses

Groen, L

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Publisher:: Western Australian Centre of Excellence in Industrial Optimisation
Publication Type:: Conference Proceeding
Citation:: Proceedings of the 18th National ASOR Conference & 11th Australian Optimisation Day, 2005, pp. 67 - 74
Issue Date:: 2005-01

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Field	Value	Language
dc.contributor.author	Groen, L	en_US
dc.contributor.editor	Caccetta, L	en_US
dc.contributor.editor	Rehbock, V	en_US
dc.date	2005-09-26	en_US
dc.date.issued	2005-01	en_US
dc.identifier.citation	Proceedings of the 18th National ASOR Conference & 11th Australian Optimisation Day, 2005, pp. 67 - 74	en_US
dc.identifier.isbn	1 7 4067 421 9	en_US
dc.identifier.uri	http://hdl.handle.net/10453/2284
dc.description.abstract	This article examines the dynamic relationship between a firm's decision to vary the quality of a product, consumer responses to this variation, and the ffect this could have on the firm's profit and value. This is achieved through the construction and anlysis of a discrete-time optimal control model which incorporates consumer response. The consumer response model is based on sampling the product's market prior to the reduction in quality. The model is then solved numerically. The optimal time to reduce quality is shown to be affected by the ratio of price and cost differentials associated with differences in quality and the shareholder's required rate of return.	en_US
dc.publisher	Western Australian Centre of Excellence in Industrial Optimisation	en_US
dc.relation.ispartof	Proceedings of the 18th National ASOR Conference & 11th Australian Optimisation Day	en_US
dc.relation.ispartof	National Conference of the Australian Society for Operations Research	en_US
dc.title	Changes in product quality and consumer responses	en_US
dc.type	Conference Proceeding
utslib.location	Perth, Australia	en_US
utslib.location.activity	Perth, Australia	en_US
utslib.for	0102 Applied Mathematics	en_US
dc.location.activity	Perth, Australia	en_US
pubs.embargo.period	Not known	en_US
pubs.organisational-group	/University of Technology Sydney
pubs.organisational-group	/University of Technology Sydney/Faculty of Science
pubs.organisational-group	/University of Technology Sydney/Faculty of Science/School of Mathematical and Physical Sciences
utslib.copyright.status	closed_access
pubs.consider-herdc	true	en_US
pubs.place-of-publication	Perth, Australia	en_US
pubs.start-date	2005-09-26	en_US

Abstract:

This article examines the dynamic relationship between a firm's decision to vary the quality of a product, consumer responses to this variation, and the ffect this could have on the firm's profit and value. This is achieved through the construction and anlysis of a discrete-time optimal control model which incorporates consumer response. The consumer response model is based on sampling the product's market prior to the reduction in quality. The model is then solved numerically. The optimal time to reduce quality is shown to be affected by the ratio of price and cost differentials associated with differences in quality and the shareholder's required rate of return.

Please use this identifier to cite or link to this item:

http://hdl.handle.net/10453/2284