An EPQ model with two-level trade credit and multivariate demand incorporating the effect of system improvement and preservation technology
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Abstract
Nowadays every decision-maker from production industries is more concern with the system improvement.
They also focused in adopting different marketing strategies to make their production system as successful
system. In the current study, a production quantity model is explored for deteriorating item by considering volume
flexibility. Multivariate demand is considered in the model which is the function of promotional efforts, selling
price, and credit period. An additional investment is made by the decision-maker to improve the system quality
and reduce the deterioration rate. Whole of the analysis is carried out under the effect of inflation. Profit function
of the current study is nonlinear so a search algorithm is suggested to obtain the optimal values of selling price,
production time, and production rate. At the end, numerical analysis along with sensitivity is executed to validate
the model and to observe the effect of different parameters on the optimal solution of the problem.
Keywords:
Economic production quantity, promotional efforts, preservation technology, two level trade credit, inflation, deterioration, multivariate demandMathematics Subject Classification:
Mathematics- Pages: 438-448
- Date Published: 01-01-2021
- Vol. 9 No. 01 (2021): Malaya Journal of Matematik (MJM)
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[33] Taft, E. W. The most economical production lot. Iron Age, $101(18)(1918), 1410-1412$.
Taleizadeh, A. A., Sari-Khanbaglo, M. P., and CárdenasBarrón, L. E. Outsourcing rework of imperfect items in the economic production quantity (EPQ) inventory model with backordered demand. IEEETransactions on Systems, Man, and Cybernetics: Systems. (2017).
Teng, J. T., and Chang, C. T. Economic production quantity models for deteriorating items with price-and stockdependent demand. Computers and Operations Research, $32(2)(2005), 297-308$
Yang, P. C. Pricing strategy for deteriorating items using quantity discount when demand is price sensitive. European Journal of Operational Research, 157(2)(2004), 389-397.
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