Motivated by a problem faced by a large manufacturer of a consumer product, we explore the interaction between production planning and capacity acquisition decisions in environments with demand growth. We study a firm producing multiple items in a multiperiod environment where demand for items...

We present a model for forecast evolution that captures two notions related to forecasts: (1) forecasts are not exact; (2) forecasts over longer horizons are less certain than those over shorter horizons. We model the forecast of discrete demand as a band defined by the lower and upper bounds on...