A simple method to investigate the effect of service constraint on EPQ model

Abstract

Huang [Mathematical Problems in Engineering, Vol. 2006, ID 79028, pp. 1–5] offered the algebraic approach to investigate the effect of service level constraint on the economic production quantity (EPQ) model with random defective rate. In this paper, we propose an arithmetic-geometric mean inequality method to simplify the algebraic method of completing perfect square established by Huang (2006) to find the optimal solution under the expected annual cost minimized. The proposed method is easy-to-understand and simple2 to-use.