<p>This study examines an imperfect manufacturing system, including rework, scrap, and defective items, utilizing advertisement-sales return and Bertrand’s linear price dependent demand for substitutable products, alongside optimal price and green production lot size as decision variables in a third-order equation. The price Break even point is established, the law of demand is validated, and the maximum potential profit is computed from the three alternate demands for the commodity. A comparative analysis is conducted between the reworking and non-reworking of defective items, concluding that reworking yields greater profit. A carbon cost and green investment technology expense are employed to mitigate carbon emissions. To our information, it is novel in the existence of Bertrand’s price model for substitute products, reworking of imperfect production with advertisement-Bertrand’s price-sales return dependent demand and optimal pricing and green production lot size as decision variables. This study aims to maximize total profit by determining the ideal price and production lot size. The applicability of this concept is illustrated by numerical examples. To evaluate the stability of the suggested model, sensitivity analysis of the best options is provided. Visual Basic 6.0 is used to generate the data.</p> Graphical Abstract <p></p>

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Bertrand’s Price Model for Substitute Products Under Reworking of Imperfect Production: Decisions on Green Production Lot Size and Pricing

  • C. K. Sivashankari,
  • S. Ragavendran,
  • V. Choudri

摘要

This study examines an imperfect manufacturing system, including rework, scrap, and defective items, utilizing advertisement-sales return and Bertrand’s linear price dependent demand for substitutable products, alongside optimal price and green production lot size as decision variables in a third-order equation. The price Break even point is established, the law of demand is validated, and the maximum potential profit is computed from the three alternate demands for the commodity. A comparative analysis is conducted between the reworking and non-reworking of defective items, concluding that reworking yields greater profit. A carbon cost and green investment technology expense are employed to mitigate carbon emissions. To our information, it is novel in the existence of Bertrand’s price model for substitute products, reworking of imperfect production with advertisement-Bertrand’s price-sales return dependent demand and optimal pricing and green production lot size as decision variables. This study aims to maximize total profit by determining the ideal price and production lot size. The applicability of this concept is illustrated by numerical examples. To evaluate the stability of the suggested model, sensitivity analysis of the best options is provided. Visual Basic 6.0 is used to generate the data.

Graphical Abstract