Article ID: | iaor1991432 |
Country: | United Kingdom |
Volume: | 41 |
Issue: | 7 |
Start Page Number: | 633 |
End Page Number: | 637 |
Publication Date: | Jul 1990 |
Journal: | Journal of the Operational Research Society |
Authors: | Yanasse Horacio Hideki |
In an EOQ system, an anticipated price increase may require determination of an exception lot. A criterion of minimizing the maximum error in terms of cumulative costs is used to determine this lot. This avoids the pitfalls raised on earlier works that compare out-of-phase inventory policies. The exception lot determined happens to be equal to the one obtained by an average cost model.