Extensive research has been devoted to economic production quantity (EPQ) problem. However, no attention has been paid to\r\nproblems where unit production and set-up costs must be considered as functions of production rate. In this paper, we address\r\nthe problem of determining the optimal production quantity and rate of production in which unit production and set-up costs are\r\nassumed to be continuous functions of production rate. Based on the traditional economic production quantity (EPQ) formula,\r\nthe cost function associated with this model is proved to be nonconvex and a procedure is proposed to solve this problem. Finally,\r\nutility of the model is presented using some numerical examples and the results are analyzed.
Loading....