Establishment of EOQ model for price and time-sensitive demand under deterioration with trade credits

R.P. Tripathi and Manjit Kaur

International Journal of Productivity and Quality Management, 2024, vol. 42, issue 1, 15-33

Abstract: This paper investigates the effect of trade credits on optimal ordering strategy in an EOQ system. We proposed an economic order quantity (EOQ) model to manage a deteriorating commodity over cycle time is assumed. The demand rate is price and time dependent. A mathematical model is developed to obtain best possible cycle time, lot-size and total cost. Furthermore, we discuss some theorems based on the optimal solution and for non-deteriorating and linearly time associated demand. The main aim is to find out the optimal cycle time and order quantity such that the total cost is minimised. Finally, we run numerical examples and sensitivity analysis to demonstrate the problem and offer administrative insights.

Keywords: time-sensitive demand; price-sensitive demand; cycle time; credit period; deterioration; inventory. (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:ids:ijpqma:v:42:y:2024:i:1:p:15-33

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