Article ID: | iaor200971536 |
Country: | Germany |
Volume: | 3 |
Issue: | 4 |
Start Page Number: | 559 |
End Page Number: | 571 |
Publication Date: | Sep 2009 |
Journal: | Optimization Letters |
Authors: | Geunes Joseph, Aral Semra |
We consider a stochastic resource allocation problem that generalizes the knapsack problem to account for random item weights that follow a Poisson distribution. When the sum of realized weights exceeds capacity, a penalty cost is incurred. We wish to select the items that maximize expected profit. We provide an effective solution method and illustrate the advantages of this approach via computational experiments.