TECHNICAL NOTE: APPROXIMATION SOLUTION FOR THE INVENTORY MODEL WITH RANDOM PLANNING HORIZON

摘要

In 1993, Moon and Yun developed a finite planning horizon economic order quantity (EOQ) model by using the Discounted Cash Flow approach. Chung and Lin then improved Moon and Yun's solution by introducing a pair of closer lower and upper bounds and bisection algorithm. To avoid the unnecessary and time-consuming numerical computations, we propose a novel approach in this paper to calculate the optimal solution of the same problem by using an accurate and efficient approximation solution directly without any further iterative numerical computations .such as the bisection algorithm.