Stochastic Inventory Model using
Exponential Lead Time Distribution with
Price Breaks

N.S. Indhumathy; DR. P.R. Jayashree

doi:https://doi.org/10.14445/22315373/IJMTT-V39P511

International Journal of Mathematics Trends and Technology

Research Article | Open Access | Download PDF

Volume 39 | Number 2 | Year 2016 | Article Id. IJMTT-V39P511 | DOI : https://doi.org/10.14445/22315373/IJMTT-V39P511

Stochastic Inventory Model using Exponential Lead Time Distribution with Price Breaks

N.S. Indhumathy, DR. P.R. Jayashree

Abstract

This paper deals with the probabilistic nature of demand with exponential lead time distribution function and price breaks. The Inventory policy is to order the quantity y, whenever the inventory drops to reorder level r. The reorder level r is a function of the lead time between placing and receiving an order. The aim of this paper is to find the optimal values of y and r by minimizing the expected total cost for a given price break. A numerical illustration and sensitivity analysis using R-language is given at the end of this paper.

Keywords

Exponential distribution, Lead time demand, Optimum order quantity, Probabilistic model, Price breaks, Reorder level, Sensitivity analysis

References

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Citation :

N.S. Indhumathy, DR. P.R. Jayashree, "Stochastic Inventory Model using Exponential Lead Time Distribution with Price Breaks," International Journal of Mathematics Trends and Technology (IJMTT), vol. 39, no. 2, pp. 84-87, 2016. Crossref, https://doi.org/10.14445/22315373/IJMTT-V39P511