Economic order and production quantity models without constraint on the percentage of defective items
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The paper deals with a version of the economic order and production quantity models when the fraction of defective items is probability variable that either may vary from cycle to cycle, or remains the same as it was in the first period. We drop the well-known assumption intended to avoid shortages, and two lot sizing rules are derived. Relationships between the new and known lot sizing rules are analyzed and cases are identified when lot sizing rules give significantly different results.
KeywordsProduction Inventory Lot sizing Defective items Backlogging
The author highly appreciates the meaningful notes and suggestions of the two unknown reviewers. The support under TÁMOP-4.2.2.C-11/1/KONV is similarly acknowledged.
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