An inventory model for two parameter Weibull deterioration and declining demand under shortages

Abstract

In this paper, for the first time, two inventory models for deteriorating items, where the demand rate is a function of time. The unit production cost is inversely proportional to demand. Two parameters Weibull deterioration has been considered for both the models. Shortages are not allowed in Model 1 whereas shortages are allowed in the Model 2 which are completely backlogged has been considered in this paper. The objective of the model is to develop optimal policy that minimizes the total average cost. Numerical examples are used to illustrate the proposed models. Sensitivity analysis has been carried out to show the effect of changes for each parameter on the optimal total average cost for both models.

Keywords:

• Inventory
• Demand
• Unit production cost
• Shortage