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REFERENCE LINKING PLATFORM OF KOREA S&T JOURNALS
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Management Science and Financial Engineering
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Journal DOI :
The Korean Operations and Management Science Society
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Volume & Issues
Volume 22, Issue 1 - May 2016
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Analysis of Two-tier Supply Chains with Multiplicative Random Yields
Park, Kyungchul ;
Management Science and Financial Engineering, volume 22, issue 1, 2016, Pages 1~4
DOI : 10.7737/MSFE.2016.22.1.001
We consider a two-tier supply chain with multiplicative random yield. We focus on the supply chain performance with respect to the control scheme of determining the production lot size. The profit loss due to distributed control is analyzed to give an insight for devising efficient supply contracts.
Some Special Cases of a Continuous Time-Cost Tradeoff Problem with Multiple Milestones under a Chain Precedence Graph
Choi, Byung-Cheon ; Chung, Jibok ;
Management Science and Financial Engineering, volume 22, issue 1, 2016, Pages 5~12
DOI : 10.7737/MSFE.2016.22.1.005
We consider a time-cost tradeoff problem with multiple milestones under a chain precedence graph. In the problem, some penalty occurs unless a milestone is completed before its appointed date. This can be avoided through compressing the processing time of the jobs with additional costs. We describe the compression cost as the convex or the concave function. The objective is to minimize the sum of the total penalty cost and the total compression cost. It has been known that the problems with the concave and the convex cost functions for the compression are NP-hard and polynomially solvable, respectively. Thus, we consider the special cases such that the cost functions or maximal compression amounts of each job are identical. When the cost functions are convex, we show that the problem with the identical costs functions can be solved in strongly polynomial time. When the cost functions are concave, we show that the problem remains NP-hard even if the cost functions are identical, and develop the strongly polynomial approach for the case with the identical maximal compression amounts.
Optimal Bankruptcy with a Continuous Debt Repayment
Lim, Byung Hwa ;
Management Science and Financial Engineering, volume 22, issue 1, 2016, Pages 13~20
DOI : 10.7737/MSFE.2016.22.1.013
We investigate the optimal consumption and investment problem when a working debtor has an option to file for bankruptcy. By applying the duality approach, the closed-form solutions are obtained for the case of CRRA utility function. The optimal bankruptcy time is determined by the first hitting time when the financial wealth hits the wealth threshold derived from the optimal stopping time problem. Moreover, the numerical results show that the investment increases as the wealth approaches the threshold and the value gain from the bankruptcy option is vanished as wealth increases.
Global Production vs. Inventory Supply and Financial Performance: Evidence from Korean Multinational Firms
Lee, Seungrae ; Park, Seung Jae ;
Management Science and Financial Engineering, volume 22, issue 1, 2016, Pages 21~26
DOI : 10.7737/MSFE.2016.22.1.021
We analyze how firms' global production activities affect their inventory supply and financial performance in regards to its production location. For the analysis, we use information on global production quantities of 3,076 Korean multinational firms that operate business in Europe and Asia through foreign direct investment (FDI) from 2006 to 2013. Our estimation results show that an increase in global production ratio, measured by global production/total production, decreases inventory supply and financial performance of firms that produce in European countries, while it decreases financial performance of firms that produce in Asian countries. Although our results indicate that global production decreases financial performance of firms that produce in Europe and Asia, we find that its negative effects on financial performance are different based on the market demand uncertainty.