WORST-CASE PERFORMANCE OF A POWER-OF-2 POLICY FOR THE QUANTITY DISCOUNT MODEL

Authors
LU L QIU YP
Citation
L. Lu et Yp. Qiu, WORST-CASE PERFORMANCE OF A POWER-OF-2 POLICY FOR THE QUANTITY DISCOUNT MODEL, The Journal of the Operational Research Society, 45(10), 1994, pp. 1206-1210
Citations number
12
Categorie Soggetti
Management,"Operatione Research & Management Science","Operatione Research & Management Science
Journal title
The Journal of the Operational Research Society → ACNP
ISSN journal
01605682
Volume
45
Issue
10
Year of publication
1994
Pages
1206 - 1210
Database
ISI
SICI code
0160-5682(1994)45:10<1206:WPOAPP>2.0.ZU;2-1
Abstract
This paper derives the worst-case performance of a power-of-two policy in an all-unit quantity discount model with one price break point, wh ich extends the sensitivity analysis for the classical EOQ model. We s how that the worst-case performance will depend on the discount rate a lpha, and is within 7.66% of optimality when alpha < 7.51%, and approx imately within 100alpha% of optimality when alpha greater-than-or-equa l-to 7.51%.