A SIMPLE SOLUTION METHOD FOR THE FINITE HORIZON EOQ MODEL FOR DETERIORATING ITEMS WITH COST CHANGES

2011 ◽  
Vol 28 (06) ◽  
pp. 689-704 ◽  
Author(s):  
HORNG-JINH CHANG ◽  
WEN-FENG LIN
Keyword(s):  
Closed Form Solution ◽  
Minimum Cost ◽  
Form Solution ◽  
Inventory System ◽  
Finite Horizon ◽  
Eoq Model ◽  
Ordering Policy ◽  
Optimal Ordering Policy ◽  
Cost Parameters ◽  
The Cost

In this article, we generalize Lev and Weiss's (1990) finite horizon economic order quantity (EOQ) model with cost change to the inventory system with deterioration. Supplier announces some or all of cost parameters may change after a decided time. Depending on whether the inventory is depleted at the time of the last opportunity to purchase before some or all of the cost parameters may change, there are two types of inventory models to be discussed. The main objective of this paper is to identify the optimal ordering policy of the inventory system by comparing the minimum cost of the two types of models. We suggest a finite horizon EOQ model to combine the above two types and propose a theorem that can quickly identify the optimal policy of the suggested model. In considering temporary price discount problem and discrete-time EOQ problem, in general, there are integer operators in mathematical models, but our approach offers a closed-form solution to these kinds of problems. Numerical examples are presented to demonstrate the results of the proposed properties and theorem.

scholarly journals Optimal control of an inventory system under whole sale price changes

2019 ◽  
Author(s):  
Ata Allah Taleizadeh ◽  
Hamidreza Zarei ◽  
Shib Sankar Sana
Keyword(s):  
Closed Form Solution ◽  
Form Solution ◽  
Price Changes ◽  
Total Saving ◽  
Ordering Policy ◽  
Decision Variables ◽  
Optimal Ordering Policy ◽  
Optimal Ordering ◽  
The Impact ◽  
Special Order

Nowadays business owners use lots of incentive schemes to make customers buy more products. In this paper optimal ordering policy for customers is obtained when the manufacturer increases the purchasing price or temporary decreases it. Offering a special sale from the manufacturer is probabilistic and shortage occurs as partial backlogging. In this paper, the initial level of inventory when the purchasing price changes is not equal to zero. With respect to the assumptions, the amount of special order quantity, the shortage quantity, and the expected total saving from making an special order is optimized for the customer. The optimal amount of decision variables are obtained by maximizing the expected total saving function and a closed-form solution is derived. Several numerical examples are solved and sensitivity analysis is performed to prove the applicability of the proposed model. Finally, the impact of some parameters of the model including the demand, the probability of making a special order, the future prices, and the initial inventory is investigated. Optimal ordering policy for the customers is obtained in cases when an announced price increase occurs and when the prices temporarily decrease.

scholarly journals Optimal Replenishment Strategy for Inventory Mechanism with a Known Price Increase and Backordering in Finite Horizon

2022 ◽  
Vol 2022 ◽  
pp. 1-14
Author(s):  
Lixia Zhang ◽  
Bo Feng
Keyword(s):  
Minimum Cost ◽  
Finite Horizon ◽  
Price Increase ◽  
Mixed Integer ◽  
Integer Optimization ◽  
Inventory Cost ◽  
Closed Form Solutions ◽  
Ordering Policy ◽  
Optimal Ordering Policy ◽  
Optimal Ordering

For the finite horizon inventory mechanism with a known price increase and backordering, based on minimizing the inventory cost, we establish two mixed integer optimization models. By buyer’s cost analysis, we present the closed-form solutions to the models, and by comparing the minimum cost of the two strategies, we provide an optimal ordering policy to the buyer. Numerical examples are presented to illustrate the validity of the model, and sensitivity analysis on major parameters is also made to show some insights to the inventory model.

scholarly journals Retailer’s Emergency Ordering Policy when Facing an Impending Supply Disruption

2021 ◽  
Vol 13 (13) ◽  
pp. 7041
Author(s):  
Jingfu Huang ◽  
Gaoke Wu ◽  
Yiju Wang
Keyword(s):  
Optimization Model ◽  
Numerical Experiments ◽  
Closed Form Solution ◽  
Form Solution ◽  
Model Solution ◽  
Inventory Cost ◽  
Supply Disruption ◽  
Procurement Policy ◽  
Ordering Policy ◽  
Procurement Strategies

Supply disruption is a common phenomenon in business activities. For the case where the supply disruption is predictable, the retailer should make an emergency procurement beforehand to decrease the inventory cost. For the scenario such that the happening time of the supply disruption obeys a certain common probability distribution but the ending time of the supply disruption is deterministic, based on minimizing the inventory cost and under two possible procurement strategies, we establish an emergency procurement optimization model. By considering the model solution in all cases, we establish a closed-form solution to the optimization model and provide an optimal emergency procurement policy to the retailer. Some numerical experiments are made to test the validity of the model and the effect of the involved parameters on the emergency procurement policy.

A New Approach to the Control Design of Fuzzy Dynamical Systems

2011 ◽  
Vol 133 (6) ◽  
Author(s):  
Ye-Hwa Chen
Keyword(s):  
Dynamical Systems ◽  
Optimization Problem ◽  
Closed Form Solution ◽  
Control Design ◽  
Form Solution ◽  
Bottom Line ◽  
New Approach ◽  
Fuzzy Dynamical System ◽  
The Cost ◽  
Fuzzy Dynamical Systems

A new approach to the control design for fuzzy dynamical systems is proposed. For a fuzzy dynamical system, the uncertainty lies within a fuzzy set. The desirable system performance is twofold: one deterministic and one fuzzy. While the deterministic performance assures the bottom line, the fuzzy performance enhances the cost consideration. Under this setting, a class of robust controls is proposed. The control is deterministic and is not if-then rules-based. An optimal design problem associated with the control is then formulated as a constrained optimization problem. We show that the problem can be solved and the solution exists and is unique. The closed-form solution and cost are explicitly shown. The resulting control is able to guarantee the prescribed deterministic performance and minimize the average fuzzy performance.

scholarly journals Non-Abelian firewall

2020 ◽  
Vol 29 (14) ◽  
pp. 2043003
Author(s):  
Douglas Singleton
Keyword(s):  
Energy Density ◽  
Equivalence Principle ◽  
Closed Form Solution ◽  
Information Loss ◽  
Form Solution ◽  
Field Equations ◽  
Yang Mills ◽  
Information Loss Paradox ◽  
The Cost ◽  
Mills Field

A simple, closed-form solution to the Yang-Mills field equations is presented which has a non-Abelian firewall — a spherical “horizon” where the energy density diverges. By the gravity/gauge duality, this non-Abelian firewall implies the existence of a gravitational firewall. Gravitational firewalls have been proposed as a way of resolving the information loss paradox, but at the cost of violating the equivalence principle.

Optimal overbooking decision for hotel rooms revenue management

2014 ◽  
Vol 5 (3) ◽  
pp. 261-277 ◽  
Author(s):  
Naragain Phumchusri ◽  
Panaratch Maneesophon
Keyword(s):  
Revenue Management ◽  
Marginal Cost ◽  
Closed Form Solution ◽  
Optimal Number ◽  
Form Solution ◽  
Comparative Statics ◽  
High Price ◽  
Model Parameters ◽  
Content Type ◽  
The Cost

Purpose – This paper aims to develop overbooking models to determine the optimal number of overbooking for hotels having one and two different types of rooms. Design/methodology/approach – This paper presents mathematical modeling to find the optimal solutions of overbooking for stochastic cancellation. Findings – The authors prove that for hotels with only one type of room, there exists a closed form solution to guarantee the optimal number of overbooking, depending on the cost of walking customers to other hotels, the cost of unsold rooms and cancellation distribution observed in the past. For hotels with two types of room, they prove the convexity structure and identify equations to seek the number of overbooking for low-price and high-price rooms. The authors also provide key comparative statics on how model parameters impact the optimal decisions under different scenarios. Practical implications – Overbooking decision is one of important and complicated decision-makings, which is related directly to the yield of hotel revenue management. It is necessary for a hotel manager to observe cancellation pattern in the history to make a reliable decision. This paper presents a method that can help hotel manager make this decision in practice. Originality/value – This paper is one of the first articles in the hotel industry that considers the marginal cost for each room unsold caused by no shows and the marginal cost for each walking guest in a comprehensive perspective.

Sign in / Sign up

Export Citation Format

Share Document