an EOQ model very thoroughly. They consider an inventory problem in which the demand is deterministic and there is a fraction of imperfect items in the lot and are screened by the buyer and sold by them at the end of the circle at discount price. See also Reorder point Safety stock Constant fill rate for the part being produced: Economic production quantity Orders placed at regular intervals: Fixed time period model Demand is random: classical Newsvendor model Demand varies over time: Dynamic lot size model Several products produced on the same machine: Economic lot scheduling problem Renewal Demand and (s, S) Optimality by Perera, Janakiraman, and Niu References Further reading Harris, Ford W. Operations Cost (Factory Management Series), Chicago: Shaw (1915) Camp, W. E. "Determining the production order quantity", Management Engineering, 1922 Plossel, George. Orlicky's Material Requirement's Planning. Second Edition. McGraw Hill. 1984. (first edition 1975) Tsan-Ming Choi (Ed.) Handbook of EOQ Inventory Problems: Stochastic and Deterministic Models and Applications, Springer's International Series in Operations Research and Management Science, 2014. . External links The EOQ Model http://www.inventoryops.com/economic_order_quantity.htm http://www.scmfocus.com/supplyplanning/2014/04/10/economic-order-quantity-calculator/ Inventory optimization de:Klassische Losformel