Development of Inventory model for inventory induced demand and time-dependent holding cost for deteriorating items under inflation

摘要

In the last few years, researchers have established their economic order quantity (EOQ) models considering both demand rate and selling price as constant. In actual practice, it is only possible in a growth stage. Demand is a function of stock-level or time for high-tech products. The research proposed here has considered a model of deteriorating items with inventory induced demand and inflation. Holding cost is assumed to be time induced and selling price is exponential time sensitive. We then developed a mathematical model to obtain total profit. Approximate optimal solution is also discussed. Numerical example and sensitivity analysis are presented indicating effects of change in several elements. Second order approximations are used for exponential terms in case of low deterioration rates.