Inventory model with variable demand rate under stochastic inflation for deteriorating and ameliorating items with permissible delay in payment
Milad Abdoli
International Journal of Operational Research, 2016, vol. 27, issue 3, 375-388
Abstract:
In this paper, an inventory policy for the production units is presented with stochastic inflation, variable demand rate, deteriorating and ameliorating items in warehouse and permissible delay in payment. Shortages, backlogging and lost sale, are allowable. Also, inflation is constantly changing due to economic, political, social and cultural issues in the real world and we assume it uniform distribution. The demand rate is depended on selling price and permissible delay in payment and increases as delay in payment increases, however, decreases as selling price increases. The objective function considers optimal pricing policy, the number of production cycles and time fraction without shortage. So, the purpose is to derive the optimal replenishment policy that minimises the net present value of total cost per unit time. The study shows that the optimal solution not only exists but also is unique. Finally, some numerical examples and sensitivity analysis on parameters are made to validate the results of the proposed inventory system.
Keywords: inventory management; deterioration; amelioration; optimisation; optimal pricing policy; inventory modelling; variable demand rate; stochastic inflation; deteriorating items; ameliorating items; permissible delay; payment delays; inventory policy; shortages; backlogging; lost sales; replenishment policy. (search for similar items in EconPapers)
Date: 2016
References: Add references at CitEc
Citations: View citations in EconPapers (1)
Downloads: (external link)
http://www.inderscience.com/link.php?id=78935 (text/html)
Access to full text is restricted to subscribers.
Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:ids:ijores:v:27:y:2016:i:3:p:375-388
Access Statistics for this article
More articles in International Journal of Operational Research from Inderscience Enterprises Ltd
Bibliographic data for series maintained by Sarah Parker ().