This model investigates an economic order quantity (EOQ) model over a finite time horizon for an item with a quadratic time dependent demand by considering shortages in inventory under permissible delay in payments. Shortages are assumed after variable time T1(< T cycle period). The credit period (m) is known and fixed. The model is derived under three different circumstances depending on the time of occurrence of shortages, credit period, and cycle time. The results are illustrated with the help of numerical examples. The sensitivity analysis of key parameters of the optimal solution is studied with respect to changes in different parametric values. Some special features of the model are discussed.
Bibliographical noteFunding Information:
The authors would like to thank the reviewers for their valuable and constructive suggestions to improve the paper. This work was supported by the University Grant Commission Minor Project, New Delhi, India (Minor Research Project, File no. 41-1433/2012(SR) ). The authors would like to acknowledge the infrastructural assistance of Vidyasagar University, West Bengal, India in carrying out the research.
All Science Journal Classification (ASJC) codes
- Economics and Econometrics