Abstract
The problem addressed in this paper is the determination of lot sizes for multiple products to be produced on a single production facility with limited capacity. Demand is assumed to be deterministic and time-varying and must be met without backordering. The objective is to minimize the sum of setup and inventory holding costs. A heuristic solution procedure of the period-by-period type is presented. Moreover, the interaction between lot sizing and smoothing of capacity requirements is investigated in a case study.
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