EOQ model for deteriorating items under elastic demand

When the quantity discount was widely used as a coordination mechanism,the problem was studied of how a retailer developed an optimal ordering strategy.On the basis of deteriorating items with respect to time and inventory,an economic order quantity problem was developed for the quantity discount under the elastic demand,which was for easy-deteriorated items.A retailer orders items as usual when without the quantity discount,and the demand rate varied linearly with time;on the other hand,for the situation of quantity discount,the ordering quantity were beyond the normal,and the demand rate were put forward varying with time and inventory.Two Economic Order Quantity(EOQ) models were built according to the two ordering strategies,whose optimal solutions proved existent by using an optimization principle.Then a numerical example and a sensitivity analysis were presented to illustrate the effectives of the two models.Finally,by comparing the two EOQ models,the result showed that an optimal ordering strategy was obtained,which was provided for the retailer ordering decision.