Abstract
In this paper, the purchaser’s optimal pricing and ordering policy is developed when the demand is assumed to be stock dependent and the supplier offers to purchase different trade credits. We solve the inventory problem by using a discounted cash-flow (DCF) approach, characterize the optimal solution, and obtain some theoretical results to find the optimal order quantity and the optimal replenishment time. Numerical examples are given to illustrate the proposed model .Sensitivity analysis for stock dependent parameter is carried out to derive managerial insights.
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