Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5471241 | Applied Mathematical Modelling | 2017 | 4 Pages |
Abstract
We consider a variant of the economic order quantity (EOQ) model. Mainly, we assume that demand occurs at random, one unit at a time, and is characterized by independent and identically distributed times between two demand epochs. We also assume that the ordering policy is characterized by ordering the same amount whenever the inventory level drops to zero, and a demand occurs. Surprisingly, we show that the optimal order quantity that minimizes the expected inventory cost follows the familiar EOQ formula.
Related Topics
Physical Sciences and Engineering
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Authors
Bacel Maddah, Nazim Noueihed,