Cost Minimization for STEOR and EOR Networks

Abstract

In this chapter we consider the case where different types of cost are incurred by the execution of activities and the occurrence of events of a project modelled by a STEOR network. We will see that the expected total cost of the project depends only on the activation functions Y_j of the individual nodes j of the network. Since the activation function Y_j of any node j in an admissible EOR network N coincides with the activation function of node j in each STEOR network from a covering of N that contains all nodes from S(j) and all arcs joining those nodes (cf. (3.5.10)), the cost minimization problem for admissible EOR networks of Markov degree d >1 can be solved in the same manner as for STEOR networks.