The Expected Value of Perfect Information in Facility Location Journal Articles

abstract

• This paper is concerned with finding the expected value of perfect information (EVPI) in a simple facility location problem where the weights, which summarize cost and volume parameters, are random draws from a multivariate probability distribution. A model with rectangular distances and one with squared Euclidean (center of gravity) are used. The analysis is developed for a multivariate normal distribution of weights but simulation is used to show that the expressions derived are reasonably accurate for other distributions (the EVPI for the multivariate lognormal distribution is illustrated).

authors

• Drezner, Z
• Wesolowsky, George

status

• published 

publication date

• April 1980

has subject area

• 0102 Applied Mathematics (FoR)
• 0802 Computation Theory and Mathematics (FoR)
• 1503 Business and Management (FoR)
• Operations Research (Science Metrix)

published in

• Operations Research  Journal

keywords

• Business & Economics
• Management
• Operations Research & Management Science
• Science & Technology
• Social Sciences
• Technology

Digital Object Identifier (DOI)

• 10.1287/opre.28.2.395

start page

• 395

end page

• 402

volume

• 28

issue

• 2