A Study on Multi-Stage Inventory Model with Restrictions on Storage Capacities : A Study on Multi-Stage Inventory Model(Part II)

Abstract

In the previous paper, we presented an algorithm for detemining the potimal inventory level by using the concept of maginal profit function in a N-stage series-type inventory model with on restrictions. In the model with restrictions on storage capacities(such as facilities or spaces), if some of the solutions offered by this algorithm are over the constraints on the maximum inventory level, we have to determine which stage the overflowing should be reallocated to. In this paper, it is shown that these stages are found out easily by a sumple method using the graph of marginal profit.