An economic order quantity model for deteriorating items with trended demand under inflation, time discounting and a trade credit policy

摘要

This paper discusses an inventory model based on the discounted cash flows (DCF) approach for the analysis of the optimal ordering policies in presence of inflation and trade-credit policy of the type α/T_1 net T. The effects of deterioration and time-value of money are also taken into account. The demand rate is assumed to be linearly trended over time. The results are illustrated with a numerical example. Optimal present worth of all future cash flows in discount case is economically beneficial. Sensitivity analysis of the optimal solution with respect to changes in the parameters of the system is carried out.