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Note---Note on "Optimal Ordering Quantity to Realize a Pre-Determined Level of Profit"

Author

Listed:
  • E. Sankarasubramanian

    (A.M. Jain College, Madras, India)

  • S. Kumaraswamy

    (A.C. College of Technology, Madras, India)

Abstract

In this note we consider the one-period inventory model in which it is required to determine the order quantity which maximizes the probability of realizing a predetermined level of profit R. We give a condition for determining the optimal order quantity and provide explicit expressions for the optimal order quantity in three special cases.

Suggested Citation

  • E. Sankarasubramanian & S. Kumaraswamy, 1983. "Note---Note on "Optimal Ordering Quantity to Realize a Pre-Determined Level of Profit"," Management Science, INFORMS, vol. 29(4), pages 512-514, April.
    • Handle: RePEc:inm:ormnsc:v:29:y:1983:i:4:p:512-514
    DOI: 10.1287/mnsc.29.4.512
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    1. repec:iim:iimawp:12794 is not listed on IDEAS
    2. Khanra, Avijit, 2014. "Multi-product newsboy problem with satiation objective," IIMA Working Papers WP2014-01-01, Indian Institute of Management Ahmedabad, Research and Publication Department.
    3. Christian Toll & Olaf Kintzel, 2019. "A nonlinear state marginal price vector model for the task of business valuation. A case study: The dimensioning of IT-service companies under nonlinear synergy effects," Central European Journal of Operations Research, Springer;Slovak Society for Operations Research;Hungarian Operational Research Society;Czech Society for Operations Research;Österr. Gesellschaft für Operations Research (ÖGOR);Slovenian Society Informatika - Section for Operational Research;Croatian Operational Research Society, vol. 27(4), pages 1079-1105, December.
    4. Tsan-Ming Choi, 2016. "Multi-period risk minimization purchasing models for fashion products with interest rate, budget, and profit target considerations," Annals of Operations Research, Springer, vol. 237(1), pages 77-98, February.
    5. Choi, Tsan-Ming & Chiu, Chun-Hung, 2012. "Mean-downside-risk and mean-variance newsvendor models: Implications for sustainable fashion retailing," International Journal of Production Economics, Elsevier, vol. 135(2), pages 552-560.
    6. Khanra, Avijit & Soman, Chetan, 2014. "Heuristics for the multi-product satiating newsboy problem," IIMA Working Papers WP2014-01-02, Indian Institute of Management Ahmedabad, Research and Publication Department.
    7. Wenqing Chen & Melvyn Sim, 2009. "Goal-Driven Optimization," Operations Research, INFORMS, vol. 57(2), pages 342-357, April.
    8. Tsan-Ming Choi, 2016. "Multi-period risk minimization purchasing models for fashion products with interest rate, budget, and profit target considerations," Annals of Operations Research, Springer, vol. 237(1), pages 77-98, February.
    9. Oberlaender, Michael, 2011. "Dual sourcing of a newsvendor with exponential utility of profit," International Journal of Production Economics, Elsevier, vol. 133(1), pages 370-376, September.
    10. Fu, Qi, 2015. "The impact of alternative performance measures on portfolio procurement with contingent option contracts," International Journal of Production Economics, Elsevier, vol. 167(C), pages 128-138.
    11. Chun-Hung Chiu & Tsan-Ming Choi, 2016. "Supply chain risk analysis with mean-variance models: a technical review," Annals of Operations Research, Springer, vol. 240(2), pages 489-507, May.
    12. Grubbström, Robert W., 2010. "The Newsboy problem when customer demand is a compound renewal process," European Journal of Operational Research, Elsevier, vol. 203(1), pages 134-142, May.
    13. Özler, Aysun & Tan, BarIs & Karaesmen, Fikri, 2009. "Multi-product newsvendor problem with value-at-risk considerations," International Journal of Production Economics, Elsevier, vol. 117(2), pages 244-255, February.
    14. Sergio Chayet & Wallace J. Hopp, 2008. "Risk‐sensitive sizing of responsive facilities," Naval Research Logistics (NRL), John Wiley & Sons, vol. 55(3), pages 218-233, April.
    15. Scott Webster & Z. Kevin Weng, 2000. "A Risk-free Perishable Item Returns Policy," Manufacturing & Service Operations Management, INFORMS, vol. 2(1), pages 100-106, July.
    16. Boutselis, Petros & McNaught, Ken, 2014. "Finite-Time Horizon Logistics Decision Making Problems: Consideration of a Wider Set of Factors," Chapters from the Proceedings of the Hamburg International Conference of Logistics (HICL), in: Blecker, Thorsten & Kersten, Wolfgang & Ringle, Christian M. (ed.), Innovative Methods in Logistics and Supply Chain Management: Current Issues and Emerging Practices. Proceedings of the Hamburg International Conferenc, volume 19, pages 249-274, Hamburg University of Technology (TUHH), Institute of Business Logistics and General Management.
    17. Khanra, Avijit, 2014. "An efficient heuristic for the multi-product satiating newsboy problem," IIMA Working Papers WP2014-06-03, Indian Institute of Management Ahmedabad, Research and Publication Department.
    18. Kamrad, Bardia & Ord, Keith & Schmidt, Glen M., 2021. "Maximizing the probability of realizing profit targets versus maximizing expected profits: A reconciliation to resolve an agency problem," International Journal of Production Economics, Elsevier, vol. 238(C).

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