• The Journal of the Convergence on Culture Technology
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• v.9 no.5
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• pp.493-499
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• 2023

Trade credit refers to a transaction where a product supplier allows an distributor to defer payment for a certain period of time for the purchase cost of the products. This practice is generally permitted as a means of differentiation between competing companies. Such trade credit is commonly granted based on the volume of transactions, aiming to increase customer orders. From the perspective of the distributor, trade credit allows for a deferred payment period for the purchase cost, leading to cost savings in inventory investment. These cost savings in inventory investment can be a factor in reducing selling prices with the aim of increasing customer demand. In this study, we analyze a model that determines the optimal selling price and order quantity from the perspective of the distributor, assuming that the supplier allows a deferred payment period dependent on the transaction volume. We assume that the final customer's annual demand exhibits an exponential decrease with respect to the distributor's selling price, using a constant price elasticity function. To analyze the problem, we assume that the product deteriorates at a constant rate over time and aim to establish an inventory model for the intermediate distributor. We also want to analyze the impact of deterioration on the inventory policies of the intermediate distributor.

• Management Science and Financial Engineering
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• v.17 no.2
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• pp.99-129
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• 2011

This paper analytically studies how to choose hedging instrument for firms with steady operating cash flows from value maximization perspective. I derive a formula to determine option's optimal strike that makes hedged cash flow have the best monetary payoff given a hedger's view on the underlying asset. I find that not only the expected mean but also the expected standard deviation of the underlying asset in relation to the forward price and the implied volatility play a crucial role in making optimal hedging decision. Higher moments play a certain part in hedging decision but to a lesser degree.

• Journal of applied mathematics & informatics
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• v.12 no.1_2
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• pp.219-231
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• 2003

This paper aims to study the problem of combined harvesting of a system involving one predator and two prey species fishery in which the predator feeds more intensively on the more abundant species. Mathematical formulation of the optimal harvest policy is given and its solution is derived in the equiblibrium case by using Pontryagin's Maximum principle. Dynamic optimization of the harvest policy is also discussed by taking E(t), the combined harvest effort, as a dynamic variable. Biological and bioeconomic interpretations of the results associated with the optimal equilibirum solution are explained. The significance of the constraints required for the existence of an optimal singular control are also given.

• Journal of Electrical Engineering and Technology
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• v.13 no.4
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• pp.1549-1557
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• 2018

Optimizing the design of large-scale electric machines based on nonlinear finite element analysis (FEA) requires longer computation time than other applications of FEA, mainly due to the huge size of the machines. This paper addresses a new region decision method (RDM) with mesh adaptive direct search (MADS) for the optimal design of wind generators in order to reduce the computation time. The validity of the proposed algorithm is evaluated using Rastrigin and Goldstein-Price benchmark function. Moreover, the algorithm is employed for the optimal design of a 5.6MW interior permanent magnet synchronous generator to minimize the torque ripple. Additionally, mechanical stress analysis as well as electromagnetic field analysis have been implemented to prevent breakdown caused by large centrifugal forces of the modified design.

• Industrial Engineering and Management Systems
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• v.14 no.2
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• pp.129-158
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• 2015

It is necessary for retailers to determine the optimal ordering policy of products considering supply disruptions due to a natural disaster and a production process failure as quality and machine breakdowns. Under the situation, a dualsourcing supply chain (DSSC) is one of effective SC for retailers to order products reliably. This paper proposes the optimal ordering policy of a product in a DSSC with a retailer and two manufacturers. Two manufacturers may face supply disruptions due to a natural disater and a production process failure after they received the retailer's order of products. Here, two scenarios of demand information of products are assumed: (i) the demand distribution is known (ii) mean and variance of the demand are known. Under above situations, two types of DSSC are discussed. Under a decentralized DSSC (DSC), a retailer determines the optimal ordering policy to maximize his/her total expected profit. Under the integrated DSSC (ISC), the optimal ordering policy is determined to maximize the whole system's total expected profit. Numerical analysis investigates how demand information and supply disruptions affect the optimal decisions under DSC and ISC. Besides, profitability of supply chain coordination adjusting the wholesale price is evaluated to encourage the optimal decision under ISC.

• Journal of Energy Engineering
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• v.23 no.1
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• pp.7-20
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• 2014

The optimal woodchip production system was developed and the production cost of a forest woodchip fuel was calculated for utilizing the pitch pine, which covers around 480,000ha nationwide. the marginal price of the woodchip fuel considering the factor of supply price, electricity and heat selling price as well as capacity factor were suggested and the economic sensitivity analysis was conducted for various scenario. The most important variable which determine economic feasibility was a fuel cost for the power generation facility. If the electricity price is higher than the current SMP(System Marginal Price) or the capacity factor is higher than 80%, there fully is a benefit to consume the woodchip fuels produced in the suggested production system in this study. In addition, the additional benefit becomes more obvious when considering REC(Renewable Energy Certificate) and CDM(Clean Development Mechanism). Therefore, it is strongly suggested for domestic power generation sector to utilize the forest biomass fuel to achieve the obligatory target of RPS.

• The Journal of Korean Institute of Communications and Information Sciences
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• v.40 no.9
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• pp.1802-1807
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• 2015

The cloud computing service provides physical IT resources to VM instances to users using virtual technique and the users pay cost of VM instances to service provider. The auction model based on cloud computing provides available resources of service provider to users through auction mechanism. The users bid spot instances to process their a job until its deadline time. If the bidding price of users is higher than the spot price, the user will be provided the spot instances by service provider. In this paper, we propose a new bidding strategy to minimize the total cost for job completion. Typically, the users propose bidding price as high as possible to get the spot instances and the spot price get high. we lower the spot price using proposed strategy and minimize the total cost for job completion. To evaluate the performance of our strategy, we compare the spot price and the total cost for job completion with real workload data.

• Environmental and Resource Economics Review
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• v.27 no.2
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• pp.339-362
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• 2018

In this paper, we simulate the contribution of an increasing renewable energy to demands for fossil fuels and power supply price by estimating a cost function for the Korean electric power generation sector. Since the renewable energy is a composite input, it is not feasible to compute the price index for renewable energy due to data limit. We estimate a restricted cost function, which is derived by minimizing the costs of fossil fuels conditional on the quantity of renewable energy set to its optimal level, jointly with supply relation. In particular, derivation of the shadow price of renewable energy would make it possible to analyze potential costs incurred by power plants.

• Environmental and Resource Economics Review
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• v.29 no.2
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• pp.219-246
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• 2020

From the Phase II (2018~2020) of K-ETS, the offset credit from 'CDM projects that domestic companies and others have carried out in foreign countries' can be used in the K-ETS. As a result, stakeholders in the K-ETS market are actively developing overseas CDM projects, such as the 'high-efficiency cook stove project'. which can secure a large amount of credits while marginal cost is relatively low. This paper develops the investment decision-making model of offset project for the 'high-efficiency cook stove project' using the real option approach. Under the uncertainty of the emission allowance price, the optimal investment threshold (p^⁎) is derived and sensitivity analysis is conducted. As a result, in the standard scenario (PoA-S), the optimal investment threshold is 29,054won/ton, which is lower than the stock price (p^⁎_spot). However, allocation entities are not only economics in the CDM project, but also CDM risk factors such as non-renewable biomass ratio, cook stove replacement ratio, equity ratio with host country, investment period and submission limitation of emission allowance. In addition, offset project developers will be able to derive the optimal investment threshold for each business stage and use it for economic feasibility checks.

• Environmental and Resource Economics Review
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• v.31 no.2
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• pp.261-290
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• 2022

Although market stabilization measures have been triggered in the K-ETS, carbon price is still under uncertainty. Considering Korea's 2030 enhanced reduction target announced in October 2021, it is crucial to have practical stabilization measures to appropriately deal with price uncertainty. This study examines the quantitative effects of a price collar, which is considered as a means of alleviating price uncertainty, on expected cumulative emissions and abatement costs. There are three main scenarios: carbon tax, emissions trading system, and emissions trading system with a price collar. Monte Carlo simulation was conducted to reflect uncertainty in emission. There are several results as follows: 1) In a price collar, domestic emission target is likely to be achieved with a lower expected abatement cost than other scenarios. In addition, there is a small amount of excess emissions in this research and it would be not critical(0.1% excess than target); 2) Prohibiting banking increases the expected abatement cost. This is because firms can not intertemporally reallocate allowances to match the firm's optimal emissions path; 3) With the adoption of a price collar, government's net revenue can be positive even if the government's purchase volume of emissions allowances is more than sales volume. This is because the government sells them at price ceiling and purchases them at price floor.