Abstract

This paper deals with an optimal ordering policy for non-deteriorating item with power demand under trade credits. The shortages are allowed and combination of backlogged and lost sales. Mathematical model is developed under two different situations, i.e., case 1: the permissible delay period is less than time to finish positive inventory and case 2 trade credit period is greater than or equal to time to finish positive inventory. Numerical examples are provided to illustrate the algorithm and theoretical results. The sensitivity analysis is provided on the optimal solution. The second order approximations are used for exponential terms to find the complexity on the optimal solution.

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