Article ID: | iaor1995427 |
Country: | Netherlands |
Volume: | 14 |
Issue: | 5 |
Start Page Number: | 283 |
End Page Number: | 290 |
Publication Date: | Dec 1993 |
Journal: | Operations Research Letters |
Authors: | Joglekar Prafulla, Lee Patrick |
Recently, approximate formulas for determining the relevant total costs and the optimal lot size in face of sudden obsolescence were proposed. In this paper, the authors provide an exact formulation of the relevant costs which, when minimized, give the true optimal lot size. The estimation errors of the approximate model are significant in some situations, and the use of the present exact model is recommended.