• STATISTICAL QUALITY CONTROL OF PROBABILISTIC (Q, r) INVENTORY MODEL WITH PARTIALLY LOST SALES WHEN LEAD TIME DEMAND NORMALLY DISTRIBUTED

Abstract

This paper derives the probabilistic continuous review inventory model that has the two types of shortage when the order cost is a function of the order quantity. The objective is to minimize the expected annual total cost under a constraint on the expected holding cost when the lead time demand follows Normal distribution by using the Lagrangian method. Some published special cases are deduced and an application is added as an illustrative numerical example with the quality control methods like X-bar and Moving average methods.