Using optimal control to adjust the production rate of a deteriorating inventory system

Abstract: This work represents is another contribution to the application of optimal control theory to production inventory systems. We consider a firm that produces some product at a certain rate and aims at improving this rate. We successfully formulated the model as an optimal control problem and obtained an explicit solution using the maximum principle. An illustrative example is provided and the sensitivity of the model to some of the system parameters was addressed. [Copyright &y& Elsevier]