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Various types of warranty programs are offered for consumer products. The two most common are a linear pro-rata warranty or a lump-sum warranty, if product failure occurs prior to the specified warranty time. In this chapter we consider additional types of warranty programs that allow the consumer to purchase a one-time extended warranty in the event of no failure within the initial warranty period. For the extended period, warranty may be linearly pro-rated, starting at an amount that is lower than the initial purchase price. Alternatively, for the extended period, warranty may be a lump-sum amount, that is less than the initial warranty amount. Expressions for the expected costs under each of the programs are derived. Guidelines are provided for determining the parameters of each warranty program under relevant constraints. Sensitivity analysis is also conducted to determine the effect of the problem parameters on the expected warranty costs.

Warranty policies for certain products, such as automobiles, often involve consideration of two attributes, for example, time and usage. Since consumers are not necessarily homogeneous in their use of the product, such policies provide protection to users of various categories. In this chapter, product usage at a certain time is linked to the product age through a variable defined as usage rate. This variable, usage rate, is assumed to be a random variable with a specified probability distribution, which permits modeling of a variety of customer categories. Another feature of the chapter is to model the propensity to execute the warranty, in the event of a failure within specified parameter values (say time or usage). In a competitive market, alternative product/warranty offerings may reduce the chances of exercising the warranty. This chapter investigates the impact of warranty policy parameters with the goal of maximizing market share, subject to certain constraints associated with expected warranty costs per unit not exceeding a desirable level.

This chapter considers warranty policies involving two attributes, such as the time elapsed since sale of the product and product usage at a given point in time. Examples of such policies are found for automobiles, where warranty may be invoked by the consumer if both time and usage are within specified warranty parameters when a product failure occurs. Here, we assume that usage and product age are related through a random variable, the usage rate, which may have a certain probabilistic distribution as influenced by consumer behavior patterns. Furthermore, product failure rate is influenced by the usage rate and product age as well as research and development expenditures per unit. It is assumed that, in production, there is a learning effect with time. The attained market share of a product will be influenced by the warranty policy parameters of warranty time and usage limit and also by the product price and product quality. An integrated model is developed to address multiobjective goals such as attainment of a specified level of market share and net profit per unit when manufacturing and warranty costs are taken into account. The impact of the goal priorities are investigated on the attained warranty policy parameters.

Two-attribute warranty policies are considered that incorporate, for example, the time elapsed since sale of the product and product usage at a given point in time. Such policies occur in consumer products, such as automobiles, where warranty may be exercised if both time and usage are within specified warranty parameters when a product failure occurs. In this chapter, it is assumed that usage and product age are related through a random variable, the usage rate, which may have a certain probabilistic distribution as influenced by consumer behavior patterns. Product quality is modeled through the product failure rate, which is influenced by unit research and development expenditures as well as the usage rate and product age. The attained market share of the product is modeled as a function of the warranty policy parameters of price, warranty time, and usage limit, with product quality also having an influence. Attainment of single and multiple objectives are explored. Such objectives encompass expected total unit costs as a proportion of unit product price and market share.

Some consumer durables, such as automobiles, involve warranties involving two attributes. These are time elapsed since the sale of the product and the usage of the product at a given point in time. Warranty may be invoked by the customer if both time and usage are within the specified warranty parameters and product failure occurs. In this chapter, we assume that usage and product age are related through a random variable, the usage rate, which may have a certain probabilistic distribution as influenced by consumer behavior pattern. Further, product failure rate is influenced by the usage rate and product age. Of importance to the organization is to contain expected warranty costs and select appropriate values of the warranty parameters accordingly. An avenue to impact warranty costs is through research on product development. This has the potential to reduce the failure rate of the product. The objective then becomes to determine warranty parameters, while constraining the sum of the expected unit warranty costs and research and development (R&D) costs per unit sales, under a limited R&D budget.

For certain consumer durables, such as automobiles, warranty policies involve two attributes. These could be the time elapsed since sale of the product and usage of the product at a given point in time. Warranty may be invoked by the consumer if both time and usage are within specified warranty parameters when a product failure occurs. In this chapter, we assume that usage and product age are related through a random variable, the usage rate, which may have a certain probabilistic distribution as influenced by consumer behavior patterns. Additionally, product failure rate is influenced by the usage rate and product age. The integrated model includes expected unit warranty costs, expected unit research and development costs, and expected unit production costs. It is assumed that in production, there is a learning effect with time. A multiobjective model is incorporated with the objectives being market share and proportion of expected warranty costs relative to total manufacturing expenditures per unit. The goals could be conflicting in nature. The problem then is to determine the warranty policy parameters while attaining certain desirable values of the two objectives.

This chapter provides a case study on a Sharīʿah-compliant home facility contract based on the Bai Bithaman Ājil (BBA) contract, generally used by Islamic banks in Malaysia. The study emphasises on the need to comply with the existing legal framework and execute relevant contracts in line with the Sharīʿah resolutions of the Sharīʿah Advisory Council of Bank Negara Malaysia without causing harm (ḍarar) to the customers or introducing uncertain elements or procedures (gharar) in the execution of the agreements. This chapter is based on doctrinal analysis of the relevant issues as well as a qualitative legal research through content analysis of relevant BBA agreements, case law as well as statutory provisions. The case study used in this chapter is completely anonymised. The study finds that the execution of BBA agreements in Malaysia leaves much to be desired. Even though the regulatory framework for Sharīʿah-compliant home financing in Malaysia is robust, there are some legal and Sharīʿah considerations which the stakeholders need to look into in order to project Malaysia as the main global hub of Islamic finance. This study demonstrates the need for proper Sharīʿah auditing of the practical execution of BBA agreements to avoid an incorporated element of gharar at the time of execution of the agreements, which might ultimately lead to unforeseen reputation risks for the bank. Though there are several studies on the Sharīʿah, financing and accounting aspects of the BBA home facility agreement, this study focusses on both Sharīʿah and legal issues, using the case study approach. The recommendations are expected to provide a good policy framework for the stakeholders in the Islamic financial services industry in Malaysia.

Purpose – As Medicare Part D enters its fifth year, we assess how the supply side of the market has evolved and what research has shown about how Medicare drug coverage has affected consumers.

Methods – We conduct descriptive data analyses to explore the varied nature of Medicare standalone prescription drug plans (in terms of both price and non-price features), examine features associated with high enrollment, and show trends over time in both plan design and enrollment patterns from 2006 to 2010. We also review existing evidence about Part D's effects on drug access for beneficiaries and conclude with a discussion of current policy concerns.

Findings – Medicare Part D has been successful in certain ways, but several areas of concern remain. Although it is a measure of success that 90% of Medicare beneficiaries now have drug coverage, efforts continue to reach the vulnerable populations who are not yet signed up. Use of medications (and relative use of generics) has increased under the program, while out of pocket costs have fallen. Policymakers continue to question government's role in areas such as negotiating prices directly with pharmaceutical manufacturers and limiting the number of plans offered. Results from data analysis indicate, among other things, high growth in premiums, whereas plans have become less generous by certain measures.

Originality – This chapter brings together data on all plans offered in Medicare Part D standalone drug coverage market and shows new evidence on the landscape's rapid evolution.

Self-employed business owners are far less compliant in reporting and paying their taxes than wage earners (employees). Discounted utility theory suggests that people act rationally and would not be willing to prepay an upcoming obligation. Mental accounting and behavioral economics theory take a different view, asserting that taxpayers will prefer a pay-as-you-go pattern (i.e., regularity). In response to these opposing theories, we conducted a behavioral experiment to see if a taxpayer who is given the opportunity to pay estimated federal income taxes monthly (instead of quarterly) will do so, and also whether they are less delinquent than those in the control group, who paid estimated federal income taxes quarterly. Our results indicate that when respondents were explicitly offered the opportunity to make monthly rather than only quarterly payments, the majority of the respondents opted to make monthly prepayments at least once. Additionally, those with an explicit option to pay as often as monthly rather than quarterly had significantly fewer dollars of delinquency. Paying more frequently could alleviate some budgeting pressures for the self-employed and result in fewer delinquencies to be collected at the federal level.