A Note on Ordering Decisions Under Imminent Price Increases

Ömer S. Benli



It is not unrealistic to assume that the opportunity cost of capital, and hence the inventory carrying charge, is a continuous function of time. On the other hand, price increases, due to inflation, for example, take place at discrete time points. Ordering decisions related with this phenomenon are analyzed in the context of a deterministic, static demand, single-item, continuous review inventory model.