Approximating Expected Warranty Costs

In this paper, we survey a portion of the literature in the analysis of warranty costs. In order to compare the price of different warranty policies, we review a framework which leads to expressing the expected costs in terms of complex functions arising in renewal theory. These functions and several approximations are discussed. In particular, a straight line approximation performs well.

• 저널Management Science · 34(12) · 1441–1449
• 토픽Statistical Distribution Estimation and Applications · Statistics and Probability
• DOI10.1287/mnsc.34.12.1441
• 저자Edward W. Frees, Seong‐Hyun Nam