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An inventory model involving back-order price discount when the amount received is uncertain

Authors :
Joko Prasetyo
Sri Sulistijowati Handajani
Nughthoh Arfawi Kurdhi
Source :
International Journal of Systems Science. 47:662-671
Publication Year :
2014
Publisher :
Informa UK Limited, 2014.

Abstract

This paper presents and analyses the continuous review inventory model with order quantity, safety factor, back-order price discount, ordering cost and lead time as decision variables. Our work is based on the paper of Huang 2010. We extend the model to incorporate the situation when the amount received is uncertain. The lead time demand is assumed follows a normal distribution. A solution procedure is developed to find the optimal solution. A numerical example is given to illustrate the model. A sensitivity analysis is also included to describe the effects of changes in the model parameters on the expected annual cost.

Details

ISSN :
14645319 and 00207721
Volume :
47
Database :
OpenAIRE
Journal :
International Journal of Systems Science
Accession number :
edsair.doi...........86df0cf4b3bb289e2cd4caa210ad5655
Full Text :
https://doi.org/10.1080/00207721.2014.900136