Inventory policies and dynamic pricing under possibility and rivals

Income management has recently become a desirable service in many circumstances. Decision makers recognize that even small developments in their operations can have a notable effect on their benefits. Nonetheless, the specification of pricing and optimal inventory policies in more practical situations may not be a manageable task. Eventually, competitors influence a supplier’s best strategy by affecting their demand, incomes, and other related actions. This paper considers a continual time optimal control model for the learning of a dynamic pricing and inventory control problem in a make-to-stock system. We evaluate a product-capacitated, dynamic setting and present a demand-based model with convex prices. Our results explain the role of capacity and the effects of the dynamic nature of demand. We then propose an additive model of demand uncertainty. We show that the strong formulation is of the same level of complication as the deterministic problem and indicate how to modify the solution method.