EOQ model for deteriorating items with stock-dependent demand under inflation and trade credits

In this paper, an economic order quantity (EOQ) model is developed for deteriorating items with inflation under the condition of permissible delay in payment. In general, if the retailer orders a large quantity, the supplier usually willing to provide the retailer a permissible delay of payments. In this paper demand rate is considered as stock dependent. Mathematical model is then developed to determine the optimal cycle time and average cost. Next, we show that the average cost per unit time is a convex function of cycle time. Numerical examples are provided to illustrate the proposed model. Finally, sensitivity analysis of the optimal solution with respect to the parameters and some managerial relevance are discussed.