TY - GEN

T1 - Continuous-time production control under periodic inventory review

AU - Kogan, Konstantin

PY - 2008

Y1 - 2008

N2 - In this paper, we consider a single-machine production system, operating under a stochastic demand. Over each production cycle, it is assumed that there is a single realization of the demand random variable. Furthermore, it is assumed that the system is operated under a periodic-review policy. Thus, the particular realization of the demand cannot be determined prior to the end of the corresponding period. The continuous-time optimal production control, that minimizes a linear combination of expected surplus and shortage costs over the planning horizon is shown to be piecewise constant, and the appropriate production levels and control breakpoints are determined as functions of the demand distribution.

AB - In this paper, we consider a single-machine production system, operating under a stochastic demand. Over each production cycle, it is assumed that there is a single realization of the demand random variable. Furthermore, it is assumed that the system is operated under a periodic-review policy. Thus, the particular realization of the demand cannot be determined prior to the end of the corresponding period. The continuous-time optimal production control, that minimizes a linear combination of expected surplus and shortage costs over the planning horizon is shown to be piecewise constant, and the appropriate production levels and control breakpoints are determined as functions of the demand distribution.

KW - Continuous-time optimization

KW - Periodic review

KW - The maximum principle

UR - http://www.scopus.com/inward/record.url?scp=77955174360&partnerID=8YFLogxK

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AN - SCOPUS:77955174360

SN - 9780889867116

T3 - Proceedings of the IASTED International Conference on Modelling, Identification, and Control, MIC

BT - Proceedings of the 27th IASTED International Conference on Modelling, Identification, and Control

T2 - 27th IASTED International Conference on Modelling, Identification, and Control

Y2 - 11 February 2008 through 13 February 2008

ER -