A Note on an Inventory Model with Inventory-level-dependent Demand Rate

Abstract

This model discusses an infinite time-horizon deterministic inventory model without shortages, where the demand rate at any instant depends on the on-hand inventory (stock level) at that instant down to a certain stock level and then it becomes constant for the remaining period of the cycle. The decision rule for finding the optimal order quantity is also given, and three numerical examples are presented to illustrate the model developed.