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A Note on the Optimal EOQ for Announced Price Increases in the Infinite Horizon

Department of Industrial Engineering and Engineering Management, Hong Kong University of Science and Technology, Clearwater Bay, Hong Kong, China
School of Business, Singapore Management University, 469 Bukit Timah Road, Singapore
iealim{at}ust.hk
br{at}smu.edu.sg

Huang et al. (2003) used the Cesaro limit of a savings function to determine the optimal special order in an EOQ model with single announced price increases over an infinite horizon. In this note, we point out that the savings function is not Cesaro summable. More importantly, no limiting argument for the cost function d(t, Q_s) as t is necessary at all given that this function is periodic for which it suffices to optimize the integral of the function over any given period.

Subject classifications: inventory; economic order quantity; special ordering for price increases.
History: Received March 2004; revision received May 2004; accepted June 2004.