Article ID: | iaor20082146 |
Country: | Netherlands |
Volume: | 35 |
Issue: | 3 |
Start Page Number: | 281 |
End Page Number: | 289 |
Publication Date: | May 2007 |
Journal: | Operations Research Letters |
Authors: | Gallego Guillermo, Ramachandran Bala, Katircioglu Kaan |
Keywords: | risk |
We show that base-stock levels first increase and then decrease as the standard deviation increases for a variety of non-negative random variables with a given mean and provide a distribution-free upper bound for optimal base-stock levels that grows linearly with the standard deviation and then remains constant.