Multiperiodic Procurement Problem with Option Contracts under Inflation
Joint Authors
Source
Mathematical Problems in Engineering
Issue
Vol. 2016, Issue 2016 (31 Dec. 2016), pp.1-11, 11 p.
Publisher
Hindawi Publishing Corporation
Publication Date
2016-03-07
Country of Publication
Egypt
No. of Pages
11
Main Subjects
Abstract EN
This paper studies the problem of the multiperiod replenishment decisions for the retailer under inflation.
In order to manage the risks of price and demand caused by inflation, the retailer has an opportunity to order products and purchase options from the supplier in each period.
We formulate the multiperiod inventory model for the retailer with option contracts and then derive his myopic ordering policy in each period and his myopic expected total discounted profit over the entire time horizon.
By taking the case without option contracts as a benchmark, we explore the effect of option contracts on the retailer’s decisions and performance under inflation.
We find that the application of option contracts might induce the retailer to reduce the firm order and increase the total order in each period under inflation.
We also find that the application of option contracts might benefit the retailer under inflation.
American Psychological Association (APA)
Wan, Nana& Chen, Xu. 2016. Multiperiodic Procurement Problem with Option Contracts under Inflation. Mathematical Problems in Engineering،Vol. 2016, no. 2016, pp.1-11.
https://search.emarefa.net/detail/BIM-1112134
Modern Language Association (MLA)
Wan, Nana& Chen, Xu. Multiperiodic Procurement Problem with Option Contracts under Inflation. Mathematical Problems in Engineering No. 2016 (2016), pp.1-11.
https://search.emarefa.net/detail/BIM-1112134
American Medical Association (AMA)
Wan, Nana& Chen, Xu. Multiperiodic Procurement Problem with Option Contracts under Inflation. Mathematical Problems in Engineering. 2016. Vol. 2016, no. 2016, pp.1-11.
https://search.emarefa.net/detail/BIM-1112134
Data Type
Journal Articles
Language
English
Notes
Includes bibliographical references
Record ID
BIM-1112134