Dynamic inventory and pricing policy in a capacitated stochastic inventory system with fixed ordering cost. (English) Zbl 1242.90008

Chao, Xiuli; Yang, Baimei; Xu, Yifan

Oper. Res. Lett. 40, No. 2, 99-107 (2012).

Summary: We study a dynamic inventory and pricing optimization problem in a periodic review inventory system with setup cost and finite ordering capacity in each period. We show that the optimal inventory control is characterized by an (\(s,s^{{\prime}},p\)) policy in four regions of the starting inventory level.

MSC:

90B05	Inventory, storage, reservoirs
90C90	Applications of mathematical programming

Keywords:

stochastic inventory system; finite ordering capacity; optimal pricing decision; strong CK-concavity

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