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Economic design of an inventory policy for non-instantaneous deteriorating items under permissible delay in payments. (English) Zbl 1183.90019
This article presents an economic order quantity model to determine the optimal replenishment policy so that the total inventory cost is minimized. The paper begins with an overview of the literature and a summary of the notation and key assumptions of the model. In the third section the authors present the proposed model, which includes a deteriorating inventory and the possibility to backlog shortages. A long series of theoretical results are presented with proof, including the necessary and sufficient conditions for the optimal solutions. This interesting article concludes with a proposed algorithm, a section containing the results of numerical experimentation, a section on the managerial implications and conclusions resulting from the model and a list of relevant references.

MSC:
90B05 Inventory, storage, reservoirs
91B06 Decision theory
91B32 Resource and cost allocation (including fair division, apportionment, etc.)
91G60 Numerical methods (including Monte Carlo methods)
91G80 Financial applications of other theories
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