We build a discrete time, serially correlated stochastic demand, nonstationary, finite horizon, capacity expansion model that includes (1) economies of scale in capacity costs, (2) positive expansion leadtimes, and (3) a fixed maximum cumulative capacity, called the shell size. When the shell...

Our Bayesian dynamic programming model builds on existing models to account for inspection delay, choice of keeping production going during inspection and/or restoration, and lot sizing. We focus on describing how dynamic statistical process control (DSPC) rules can improve on traditional,...

This paper derives the optimal simultaneous capacity and production plan for a shortlife-cycle, produce-to-stock good under stochastic demand. Capacity can be reduced as well as added, at exogenously set unit prices. In both cases studied, with and without carryover of unsold units, a target...