Analysis of inventory models with budget constraint.

Abstract

This thesis addresses the problem of determining the optimal number of spares for a multi-item inventory system with a procurement budget constraint. Various inventory models are considered with objective functions like time-weighted units short, units short, essentiality -weigh ted units short and pseudo-availability. Solution algorithms are derived using the generalized Lagrange multiplier approach and a marginal analysis approach. Sample data and output results are provided and comparisons of the alternative models are given. Finally, a discussion and example is given of the use of the models as a means of estimating the budget required to attain a specified level of performance.