Exact, approximate, and generic iterative models for the multi-product Newsboy problem with budget constraint

Layek Abdel-Malek, Roberto Montanari, Libia Cristina Morales

Research output: Contribution to journalArticlepeer-review

71 Scopus citations

Abstract

Because of the increased importance of inventory control/management in today's supply chain environment, we revisit the seminal work of Hadley and Whitin; that is the multi-product Newsboy problem with budget constraint. In this paper, we present exact solution formulae when the demand probability density function is uniform and generic iterative method (GIM), which yields optimum, or near optimum, solution for general continuous density functions of the demand. A salient feature of GIM is that as it progresses, one can compute the error allowing the user to stop when the desired level of accuracy is achieved. Illustrative examples are given in order to show the application of the proposed models.

Original languageEnglish (US)
Pages (from-to)189-198
Number of pages10
JournalInternational Journal of Production Economics
Volume91
Issue number2
DOIs
StatePublished - Sep 28 2004

All Science Journal Classification (ASJC) codes

  • Business, Management and Accounting(all)
  • Economics and Econometrics
  • Management Science and Operations Research
  • Industrial and Manufacturing Engineering

Keywords

  • Budget constraint
  • Inventory
  • Newsboy problem
  • Single period problem

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