Deterministic models of perishable inventory with stock-dependent demand rate and nonlinear holding cost

Deterministic models of perishable inventory with stock-dependent demand rate and nonlinear holding cost

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Article ID: iaor19992201
Country: Netherlands
Volume: 105
Issue: 3
Start Page Number: 467
End Page Number: 474
Publication Date: Mar 1998
Journal: European Journal of Operational Research
Authors: ,
Keywords: deteriorating items
Abstract:

This paper deals with an extended economic order quantity type inventory model for a perishable product where the demand rate is a function of the on-hand inventory. The traditional parameters of unit item cost and ordering cost are kept constant; but the holding cost is treated as (i) a nonlinear function of the length of time for which the item is held in stock, and (ii) a functional form of the amount of the on-hand inventory. The approximate optimal solution in both the cases is derived. Computational results are presented indicating the effects of nonlinearity in holding costs.

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