keywords: Production, inventory, delayed demand, optimal cost, deterioration and buffer stock
This paper discusses a production inventory model for delay demand and deterioration. The production rate is a linear function of the on-hand inventory level. The inventory reduces to the level of buffer stock after production. The paper focuses on obtaining the total optimum average inventory cost, optimum ordering cost, optimum time for a maximum inventory and optimum order quantity. Numerical examples are provided to support our findings.