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A Planning Horizon Theorem and Optimal Ordering Policies in the Case Where Demand Rate Varies Once Over a Finite Planning Holizon

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Academic year: 2021

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ABSTRACT

A PLANNING HORIZON THEOREM AND OPTIMAL

ORDERING POLICIES IN THE CASE WHERE

DEMAND RATE VARIES ONCE OVER

A FINITE PLANNING HORIZON

Zentaro NAKAMURA Keio University Akira NIWA seikei University Ichiei WATANABE Keio University

This paper deals with the continous review lot sizing problem in the case •• here demand rate varies once over a finite planning horizon. In the ease of demand rate varing once over a finite planning horizon, relationship between demand rate prior to the demand turning point and the after affects the selec-tion of the optimal ordering policies.

This paper shows that information concerning the location of the demand turning point and optimal number of deliveries in the periods prior to and after the demand turning point can effectively be used to determine optimal ordering policies. It presents a planning horizon theorem which assures the condition under which the planning period can be separated into two independent subperiods at the demand turning point.

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