ECONOMIC ORDER QUANTITY MODEL FOR DETERIORATING ITEMS WITH IMPERFECT QUALITY

Abstract

In an EOQ model it is tacitly assumed that the 100% items in a lot are of perfect quality. This is possible only under very idealistic
situation but practically this assumption may not be true. Thus, the inspection of lot becomes indispensable in all public and private
sector organizations. Moreover, it plays a very significant role when the products are of deteriorating in nature. In this paper an attempt has been made to formulate an inventory model for deteriorating items with imperfect quality. The inspection/screening rate i s assumed to be more than the demand. This assumption helps one to fulfill the demand, out of the products which are found to be of perfect quality, along with the screening process. A hypothetical example is considered to validate the model and results are obtained using Matlab7.0.1. Comprehensive sensitivity analysis has also been presented