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Purchase-Inventory Decision Models for Inflationary Conditions

Author

Listed:
  • Sumer C. Aggarwal

    (Division of Management Science, The Pennsylvania State University, 310 Business Administration Building, University Park, Pennsylvania 16802)

Abstract

This paper develops two deterministic models for helping purchasing and materials managers in calculating economic replenishment order sizes under two specific situations. Each of these situations (questions) is frequently faced by practicing managers under current inflationary conditions. The two specific situations are: (1) one chance to place an optimum reorder before a step increase in purchase cost; and (2) optimum size of the next reorder considering that any other future reorder will be subject to a constant rate of inflation. For each of these two situations a derivation of the model in presented, and then the usage of each derivation is illustrated in detail with a typical real-world numerical example.

Suggested Citation

  • Sumer C. Aggarwal, 1981. "Purchase-Inventory Decision Models for Inflationary Conditions," Interfaces, INFORMS, vol. 11(4), pages 18-23, August.
    • Handle: RePEc:inm:orinte:v:11:y:1981:i:4:p:18-23
    DOI: 10.1287/inte.11.4.18
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    Citations

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    Cited by:

    1. Ray, J. & Chaudhuri, K. S., 1997. "An EOQ model with stock-dependent demand, shortage, inflation and time discounting," International Journal of Production Economics, Elsevier, vol. 53(2), pages 171-180, November.
    2. Nita H. Shah & Chetansinh R. Vaghela, 2017. "Economic order quantity for deteriorating items under inflation with time and advertisement dependent demand," OPSEARCH, Springer;Operational Research Society of India, vol. 54(1), pages 168-180, March.
    3. Moon, Ilkyeong & Giri, Bibhas Chandra & Ko, Byungsung, 2005. "Economic order quantity models for ameliorating/deteriorating items under inflation and time discounting," European Journal of Operational Research, Elsevier, vol. 162(3), pages 773-785, May.
    4. Ranveer Singh Rana & Dinesh Kumar & Kanika Prasad, 2022. "Two warehouse dispatching policies for perishable items with freshness efforts, inflationary conditions and partial backlogging," Operations Management Research, Springer, vol. 15(1), pages 28-45, June.

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