Technical Note---On the Quasiconcavity of Lost-Sales Inventory Models with Fixed Costs

Qing Li () and Peiwen Yu ()
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Qing Li: School of Business and Management, Hong Kong University of Science and Technology, Clear Water Bay, Kowloon, Hong Kong
Peiwen Yu: School of Business and Management, Hong Kong University of Science and Technology, Clear Water Bay, Kowloon, Hong Kong

Operations Research, 2012, vol. 60, issue 2, 286-291

Abstract: We show that under a set of conditions, both the maximal profit function and the objective function in several lost-sales inventory models with fixed costs are quasiconcave. Not only is the quasiconcavity property useful computationally, it also leads to a sharper characterization of the optimal policies. Neither the proof of the quasiconcavity property itself nor the proof of the optimal policies by using the property requires the machinery of K -concavity or any of its K -related extensions, and hence they are intuitively appealing.

Keywords: periodic-review inventory systems; fixed costs; optimal policies; quasiconcavity (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (2)

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