A stochastic inventory model with perishable and ageing items

A stochastic inventory model with perishable and ageing items

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Article ID: iaor20001341
Country: United States
Volume: 12
Issue: 1
Start Page Number: 23
End Page Number: 29
Publication Date: Jan 1999
Journal: Journal of Applied Mathematics and Stochastic Analysis
Authors: , ,
Keywords: markov processes
Abstract:

In this paper, we propose a single-product, discrete time inventory model for perishable items. Inventory levels are reviewed periodically and units in stock have a maximum lifetime of M periods. It is assumed that the dynamics of the inventory level is driven by a parameter process (reflecting perishability) and demands. By observing the history of the inventory level we obtain the conditional distribution of the perishability parameter by using the change of measure techniques. A special case is also presented.

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