University of Belgrade, Faculty of Organizational Sciences Laboratory for Operations Research
In economic order quantity (EOQ) models, it is often assumed that the payment of an order is made on the receipt of items by the inventory system. However, such an assumption is not quite practical in the real world. Under most market behaviours, it can be easily found that a vendor provides a credit period for buyers to stimulate demand. In this paper, a varying rate of determination and the condition of permissible delay in payments used in conjunction with the economic order quantity model are the focus of discussion. Numerical examples are presented to illustrate the proposed models.
Yugoslav Journal of Operations Research 12(1), pp.73-84