On the optimality of a general production lot size inventory model with variable parameters

A general production lot size dynamic inventory model with deteriorating items for which the rates of demand, production, deterioration as well as the cost parameters are arbitrary and known functions of time is considered in this paper. Shortages are allowed but are partially backordered. Both inflation and time value of money are taken into account. The objective is to minimize the total net inventory cost. The relevant model is built, solved and some main results about the uniqueness and the global optimality of this solution, with the use of rigorous mathematical methods, are obtained. An illustrative example is provided.

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