IDEAS home Printed from https://ideas.repec.org/a/inm/ormnsc/v30y1984i10p1250-1254.html
   My bibliography  Save this article

Periodic Review Inventory Systems with Continuous Demand and Discrete Order Sizes

Author

Listed:
  • John N. Tsitsiklis

    (Department of Electrical Engineering, Stanford University, Stanford, California 94305)

Abstract

We study a single product inventory system with nonnegative setup cost in which the demand is a continuous random variable but orders are restricted to be integer valued. Optimal policies, when there are no setup costs, have a nice form. However, we show that, when the setup costs are nonzero, optimal policies may have a very counterintuitive form without any particular structure. We obtain a bound for the increase in costs resulting from the restriction of orders to be integers and define a suboptimal policy whose performance is within that bound.

Suggested Citation

  • John N. Tsitsiklis, 1984. "Periodic Review Inventory Systems with Continuous Demand and Discrete Order Sizes," Management Science, INFORMS, vol. 30(10), pages 1250-1254, October.
  • Handle: RePEc:inm:ormnsc:v:30:y:1984:i:10:p:1250-1254
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1287/mnsc.30.10.1250
    Download Restriction: no

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:inm:ormnsc:v:30:y:1984:i:10:p:1250-1254. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mirko Janc). General contact details of provider: http://edirc.repec.org/data/inforea.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.