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Optimal Admission Control in Two-Class Preemptive Loss Systems

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Executive Summary

The authors study optimal admission control in a two-class preemptive loss system. A class-1 customer arrival aborts service of a class-2 customer if the system is full upon arrival. Each successfully serviced class-2 customer leads to a reward, whereas each aborted class-2 customer incurs a cost. Using dynamic programming, they characterize optimal admission control for class-2 customers that maximize the long-run average profit. The optimal admission control policy depends only on the total occupancy and is of threshold type.

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