11th Annual International Conference on Industrial Engineering and Operations Management

Application of Economic Mathematical Model in Production of Gold Sub-Sector in Indonesia

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Track: Operations Management

Gold is a metal that has a high purchasing power and Indonesia is one of the world's gold producing countries. Gold is a non-renewable natural resource, the formation process takes a long time and its availability can be used up. Thus the need for managing the availability of gold in Indonesia to prevent scarcity and can be one of the considerations in making decisions to control the price of gold in the market. The application of economic mathematical models that can be applied in the estimation of gold production in Indonesia is a sigmoid function. The sigmoid function that can be used to estimate the cumulative production of gold in Indonesia is the logistical function and the Gompertz function. Based on the research logistic model is the most appropriate model used in the prediction of cumulative production in Indonesia. The logistic model was chosen because it fulfills the two best model requirements namely, based on the highest R 2  value and the lowest RMSE. Logistic model shows that the cumulative production of gold in Indonesia can increase to 107895,148 Oz after the year 2040.

Published in: 11th Annual International Conference on Industrial Engineering and Operations Management, Singapore, Singapore

Publisher: IEOM Society International
Date of Conference: March 7-11, 2021

ISBN: 978-1-7923-6124-1
ISSN/E-ISSN: 2169-8767