This paper mainly deals with the design of an optimal inventory model which minimizes the total expected cost for perishable items with a positive lead time. In this model the solution methodology for the optimal order quantity is presented and the behavior of the expected cost function is also analysed which is convex in order quantity. Based on the Mathematical formulation of the inventory system, the optimal ordering quantity that minimizes the expected cost for a perishable item over a finite horizon is obtained.
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