An optimal inventory pricing and ordering strategy subject to stock and price dependent demand
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Author
Wallace, James
Tsoularis, Anastasious
Attention
2299/27112
Abstract
This article considers the deterministic optimalcontrol problem of profit maximization for inventory replenishedat a variable rate and depleted by demand which is assumed tovary with price and stock availability. Optimal policies for theinventor, product order rate and price are derived using themaximum principle. Bounds on the maximum price possible arealso derived.