Operations Research Simplified produced by www.universalteacher.com. The Basic Deterministic Inventory Models Before examining the solution of specific inventory models, we provide the notations used in the development of these models.
Q = Number of units ordered per order. Index of /divisions/bp/app/russellcd/PROTECT/CHAPTERS/CHAP12. Chapter 12, Head 3. In a continuous, or fixed-order-quantity, system when inventory reaches a specific level, referred to as the reorder point, a fixed amount is ordered.
The most widely used and traditional means for determining how much to order in a continuous system is the economic order quantity (EOQ) model, also referred to as the economic lotsize model. The earliest published derivation of the basic EOQ model formula in 1915 is credited to Ford Harris, an employee at Westinghouse.