Inventory Model for Deteriorating Items Having Linear Time Dependent Demand Under Downstream Trade Credit

Abstract

In the literature, either upstream or two-level trade credit was considered in developing inventory
models for deteriorating items. Thus, in this study, downstream trade credit is considered only in
developing an inventory model for deteriorating items. The demand is assumed to be linearly dependent
on time. Cost functions of the model were derived and convexity of the cost functions was established.
As an illustration of the performance of the model, numerical examples is given. Sensitivity analysis
was carried out to test the importance of the model parameters. From the result of the numerical
example, it shows that the total annual relevant costs in the second case is the least and present the
optimal case.