| Article ID: | iaor200962 |
| Country: | Serbia |
| Volume: | 17 |
| Issue: | 2 |
| Start Page Number: | 195 |
| End Page Number: | 208 |
| Publication Date: | Jul 2007 |
| Journal: | Yugoslav Journal of Operations Research |
| Authors: | Chaudhuri K.S., Roy T. |
| Keywords: | economic order |
A finite time-horizon deterministic inventory model is developed, taking the demand rate at any instant to be a function of the on-hand inventory (stock-level) at that instant. Shortages in inventory are allowed. The effects of inflation and time value of money are considered. Two separate inflation rates: namely, the internal (company) and the external (general economy) are introduced. A numerical example of the model is discussed.