A methodology for comparing the variable costs of the continuous and periodic review models.

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Author
Knaggs, Christopher D.
Date
1984-03Advisor
McMasters, Alan W.
Second Reader
Solis, A.R.
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Show full item recordAbstract
The optimal use of the continuous review model requires
that an inventory system be examined after the receipt of
every demand. Sometimes a delay can be encountered in the
timing of these reviews due to several uncontrollable
factors. As the length of these delays increases, a point
is reached where it is better to switch the inventory system
to a periodic review model. This thesis develops a methodology
by which this point can be found for varying cost factors and
demand levels. Using simulation, an example series of curves
is presented that demonstrates the optimal point to switch
inventory models for selected lead times. If delays are
expected in the time between reviews , using the methodology
offered in this paper will provide the manager an
informational criterion for deciding what inventory model to
use in a stocking system.
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This publication is a work of the U.S. Government as defined in Title 17, United States Code, Section 101. Copyright protection is not available for this work in the United States.Collections
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