EOQ Models for Deteriorating Items with Time-varying Demand and Partial Backorder under Inflation

This paper, through the discounted cash flow (DCF) approach, considers inventory replenishment problems for deteriorating items with general time-varying demand over a finite planning horizon under inflation. The optimal replenishment policies for the total profit of system to be maximum are presented with partial backlogging. Moreover, the fraction of demand backlogged is assumed to be a non-increasing function of waiting time. Firstly, the models with a fixed fraction backorder and complete backorder are provided. Then the model is presented with assuming that the fraction of demand backlogged is an exponentially decreasing function of waiting time. The solution procedures of models are proposed. The effect of inflation on the optimal policies is shown. The models are illustrated through numerical examples and sensitivity analysis of parameters is given.