[KSCI] Korea Science Citation Index Service

http://dx.doi.org/10.5351/CKSS.2004.11.3.631

Optimal Restocking Policy of an Inventory with Constant Demand

Ki, Jeong Jin (Department of Statistics, Sookmyung Women’s University)
Lim, Kyung Eun (Department of Statistics, Sookmyung Women’s University)
Lee, EuiYong (Department of Statistics, Sookmyung Women’s University)

Publication Information

Communications for Statistical Applications and Methods / v.11, no.3, 2004 , pp. 631-641 More about this Journal

Abstract

In this paper, a model for an inventory whose stock decreases with time is considered. When a deliveryman arrives, if the level of the inventory exceeds a threshold $\alpha$ , no stock is delivered, otherwise a delivery is made. It is assumed that the size of a delivery is a random variable Y which is exponentially distributed. After assigning various costs to the model, we calculate the long-run average cost and show that there exist unique value of arrival rate of deliveryman $\alpha$ , unique value of threshold $\alpha$ and unique value of average delivery m which minimize the long-run average cost.

Keywords

inventory; Poisson process; long-run average cost; restocking policy;

Citations & Related Records

Reference

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