Accession Number : AD0680933
Title : A PRODUCTION AND INVENTORY CONTROL MODEL FOR A MULTI-COMMODITY SYSTEM WITH PROBABILISTIC DEMAND AND INTERACTING SET-UP COST.
Descriptive Note : Technical rept.,
Corporate Author : FLORIDA UNIV GAINESVILLE DEPT OF INDUSTRIAL AND SYSTEMS ENGINEERING
Personal Author(s) : Sivazlian,B. D.
Report Date : NOV 1967
Pagination or Media Count : 37
Abstract : The characteristics of a multi-product production and inventory system with probabilistic demand and interdependency in the set-up cost are studied over a single period, and optimal ordering policies for inventory replenishment are derived. Three cost elements are assumed to affect the operation of the system: a production cost, a holding cost and a penalty cost. The fixed component of the production cost, i.e., the set-up cost, will, in general, depend on whether an individual ordering policy, a partial joint ordering policy or a total joint ordering policy from production is used. In general, for an n-commodity system, one can define the optimal strategies over a policy space in E superscript n. This concept is illustrated for n = 2. Thus, depending on the initial stock level of the items either of the four following alternatives is possible: (a) produce the first item only; (b) produce the second item only; (c) produce both items simultaneously; (d) do not produce anything. The general problem is clearly equivalent to a multi-commodity, multi-warehouse system supplied by a single source. (Author)
Descriptors : (*INVENTORY CONTROL, MATHEMATICAL MODELS), (*PRODUCTION CONTROL, MATHEMATICAL MODELS), INVENTORY ANALYSIS, REPLACEMENT THEORY, INVENTORY CONTROL, PROCUREMENT, COSTS, COST EFFECTIVENESS, PERIODIC VARIATIONS, RANDOM VARIABLES, INVENTORY CONTROL
Subject Categories : Operations Research
Distribution Statement : APPROVED FOR PUBLIC RELEASE