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A nonlinear optimization model for optimal order quantities with stochastic demand rate and price change

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  • An inventory problem in which the stochastic demand rate in each period is considered. A model is presented to compute optimal order quantities and optimal delivery points in the planning period. This model can also account for any anticipated price change that may occur from time to time. In addition the model can be used to compute volume discounts in accordance to the size of the order. A stochastic global optimization algorithm is used to obtain the numerical results.
    Mathematics Subject Classification: Primary: 90B05; Secondary: 65K05.


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