THE WEALTH MAXIMIZING ORDERING QUANTITY: AN EXTENSION
ABSTRACT This paper derives a simple analytical expression for the value maximizing economic ordering quantity (EOQ). The traditional EOQ formula can be derived from this expression through a second‐order Taylor series expansion. This connection explains McDaniel's recent simulation results sho...
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Published in | The Financial review (Buffalo, N.Y.) Vol. 23; no. 2; pp. 227 - 232 |
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Main Author | |
Format | Journal Article |
Language | English |
Published |
Oxford, UK
Blackwell Publishing Ltd
01.05.1988
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Subjects | |
Online Access | Get full text |
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Summary: | ABSTRACT
This paper derives a simple analytical expression for the value maximizing economic ordering quantity (EOQ). The traditional EOQ formula can be derived from this expression through a second‐order Taylor series expansion. This connection explains McDaniel's recent simulation results showing that the EOQ is an accurate estimator of the optimal ordering quantity. |
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Bibliography: | istex:0DE79B26BD72C6A519BFE80FB55CACB646528029 ark:/67375/WNG-J56QK1PR-L ArticleID:FIRE227 |
ISSN: | 0732-8516 1540-6288 |
DOI: | 10.1111/j.1540-6288.1988.tb00788.x |