Thats a unique idea.You should consider the following idea to enhance your idea so that it would impact uniquely:  studies cost uncertainty in services. Despite the fact that the service sector has become the largest component of gross domestic products in most developed economies, cost uncertainty and its impact on pricing decisions have not received much attention in the literature. ,  first identify the root causes of cost uncertainty in services. Using the distinctive characteristics of services defined in the literature,  show why cost uncertainty, which has been widely neglected in the manufacturing dominated literature, is pervasive in services. Next,  investigate how cost uncertainty affects a risk-averse service provider’s pricing decisions in a make-to-order setting. Using the expected utility theory framework,  show that cost uncertainty increases the optimal price, whereas demand uncertainty reduces it. As a result of the countervailing impacts, the optimal price under risk aversion may be larger or smaller than the optimal risk-neutral price. Next,  study the problem of optimizing cost contingency in service contract pricing.  show that the optimal cost contingency decreases as the profit of the contract increases even when the utility function exhibits an increasing absolute risk aversion. Finally,  introduce various strategies to mitigate the risk of cost uncertainty observed in practice, and propose new research problems.
['Sechan Oh', 'James J. Rhodes', 'Ray Strong']
I am writing a research paper on a idea Impact of cost uncertainty on pricing decisions under risk aversion
[{"from": "human", "value": "I am writing a research paper on a idea Impact of cost uncertainty on pricing decisions under risk aversion"}, {"from": "gpt", "value": "Thats a unique idea.You should consider the following idea to enhance your idea so that it would impact uniquely:  studies cost uncertainty in services. Despite the fact that the service sector has become the largest component of gross domestic products in most developed economies, cost uncertainty and its impact on pricing decisions have not received much attention in the literature. ,  first identify the root causes of cost uncertainty in services. Using the distinctive characteristics of services defined in the literature,  show why cost uncertainty, which has been widely neglected in the manufacturing dominated literature, is pervasive in services. Next,  investigate how cost uncertainty affects a risk-averse service provider\u2019s pricing decisions in a make-to-order setting. Using the expected utility theory framework,  show that cost uncertainty increases the optimal price, whereas demand uncertainty reduces it. As a result of the countervailing impacts, the optimal price under risk aversion may be larger or smaller than the optimal risk-neutral price. Next,  study the problem of optimizing cost contingency in service contract pricing.  show that the optimal cost contingency decreases as the profit of the contract increases even when the utility function exhibits an increasing absolute risk aversion. Finally,  introduce various strategies to mitigate the risk of cost uncertainty observed in practice, and propose new research problems."}]