Chapter 82. Inventory modeling with uncertain demand
Questions answered in this chapter:
At what inventory level should I place an order if my goal is to minimize the annual holding, ordering, and shortage costs?
What does the term 95 percent service level mean?
In Chapter 81, “The economic order quantity inventory model,” I showed you how to use the economic order quantity (EOQ) to determine an optimal order quantity and production batch size. The examples assumed that demand occurred at a constant rate. Thus, if annual demand occurred at a rate ...