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4QA3 F12 Week 8 Lecture Notes

# 4qa3 f12 a gandomi 9 source nahmias 2009 4qa3

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Unformatted text preview: F12 A. Gandomi 9 Source: Nahmias (2009) 4QA3 F12 A. Gandomi 10 ●  The expected annual cost function is given by: "Q % λ λ n ( R) G (Q, R) = h \$ + R − λτ ' + K + p Q Q #2 & s ∞ where n R = ∫ ( x − R) f ( x ) dx () R n(R): the expected number of stockouts per cycle. ●  The optimal values of (Q,R) that minimizes G(Q,R) can be found iteratively from: 4QA3 F12 Q= ( ( )) 2λ K + pn R h Qh and 1 − F ( R) = pλ A. Gandomi 11 ●  For normally distributed D, n(R) is found by using standardized loss function: ∞ () ∫ Lz= ●  z (1 − z )φ (t ) dt When the lead time demand, D, is normal with mean μ and standard deviation, σ, it can be shown that () () n R =σ L z ●  L(z) values are given in Table A- 4. ●  Note: if the periodic demand has mean λ and standard deviation ν, then, µ = λτ and σ = ν τ 4QA3 F12...
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