An Economic Order Quantity Model under Random Life Cycle

불확실한 수명주기의 제품에서의 경제적 주문량 모형

This paper considers an Economic Order Quantity Model under random life cycle. It is assumed that the life cycle of the product is unknown; a random variable. Three cost parameters are considered; ordering cost, inventory carrying cost and salvage cost. Expected total cost is the optimization criterion. We show that the optimal cycle length is unique and finite, and present a simple line search method to find an optimal cycle length.