Consider the following inventory situation. Demands in different periods are independent but with a common probability density

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Consider the following inventory situation. Demands in different periods are independent but with a common probability density function given by

D()

Orders may be placed at the start of each period without setup cost at a unit cost of c 10. There are a holding cost of 6 per unit remaining in stock at the end of each period and a shortage cost of 15 per unit of unsatisfied demand at the end of each period (with backlogging except for the final period).

(a) Find the optimal one-period policy.

(b) Find the optimal two-period policy.

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Introduction To Operations Research

ISBN: 9780072321692

7th Edition

Authors: Frederick S. Hillier, Gerald J. Lieberman

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