• INVENTORY MODEL FOR TIME VARYING HOLDING COST UNDER TRADE CREDIT AND QUADRATIC DEMAND FOR DETERIORATING GOODS

Abstract

Operation research’s role in both, the public and the private sectors is increasing rapidly. Inventory modeling is an important part of Operation Research, which may be used in large numbers of problems. To make it applicable in real life situations researchers are busy in modifying the existing models on different parameters under various circumstances. In this present paper we study a deterministic inventory model for quadratic demand with time varying holding cost and trade credit under deteriorating environment, supplier offers a credit limit to the customer during whom there is no interest charged, upon the expiry of the prescribed time limit, the supplier will charge some interest. However, the customer has the reserve capital to make the payment at the beginning, but decides to take the benefits of the credit limit. The objective of the model is to develop an optimal policy that minimizes the total average cost. Numerical examples are used to illustrate the developed models. Sensitivity analysis of the optimal solution with respect to major parameters is carried out.