Optimised asset replacement strategy in the presence of lead time uncertainty

This paper develops an optimal replacement strategy for capital intensive equipment with long delivery lead time. The strategy is based on an extended version of the real options approach to repeated replacement decisions, in which the goal is to determine the operating cost and delivery lead-time conditions upon which a replacement should be ordered.

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Year of publication:	2013
Authors:	Richardson, Steven ; Kefford, Adrian ; Hodkiewicz, Melinda
Published in:	International Journal of Production Economics. - Elsevier, ISSN 0925-5273. - Vol. 141.2013, 2, p. 659-667
Publisher:	Elsevier
Subject:	Replacement \| Lead time \| Real options \| Optimisation

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Type of publication:	Article
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10010869066