EXPONENTIAL BACKORDER COSTS AND CONTINUOUS LEAD TIMES FOR THE (M,T) INVENTORY MODEL SERIES 1
Keywords:
Exponential distribution, Continuous lead times, normal distribution, gamma distribution, stockout probability, backorder costs and inventory costs.Abstract
The inventory model (M,T) with exponential backorder costs and continuous lead time is the model considered in this paper. At review time the stock is ordered to bring it to level M. The (M,T) model is derived from the inventory costs of inventory model (n,Q,R,T), when at review time a multiple of Q, n = 1,2---, is ordered, the lead time is assumed to follow a gamma distribution and demand during lead time is assumed to be a normal variate. The backorder cost is exponential, Cβ (t)= b_1 exp (b_2 t).
