A generalized geometric-programming solution to ‘An economic production quantity model with flexibility and reliability considerations’

A generalized geometric-programming solution to ‘An economic production quantity model with flexibility and reliability considerations’

0.00 Avg rating0 Votes
Article ID: iaor20084342
Country: Netherlands
Volume: 176
Issue: 1
Start Page Number: 240
End Page Number: 251
Publication Date: Jan 2007
Journal: European Journal of Operational Research
Authors:
Keywords: programming: geometric
Abstract:

The classical economic production quantity (EPQ) model assumes that items are produced by a perfectly reliable production process with a fixed set-up cost. While the reliability of the production process cannot be perfected cost-free, the set-up cost can be reduced by investment in flexibility improvement. In this paper, we propose an EPQ model with a flexible and imperfect production process. We formulate this inventory decision problem using geometric programming (GP), establish more general results using the arithmetic–geometric mean inequality, and solve the problem to obtain a closed-form optimal solution. Following the theoretical treatment, we provide a numerical example to demonstrate that GP has potential as a valuable analytical tool for studying a certain class of inventory control problems. Finally we discuss some aspects of sensitivity analysis of the optimal solution based on the GP approach.

Reviews

Required fields are marked *. Your email address will not be published.