Epq with process capability and quality assurance considerations

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55 Citations (Scopus)

Abstract

The classical economic production quantity (EPQ) model assumes that items produced are of perfect quality and that the unit cost of production is fixed. However, in realistic situations, product quality is never perfect but is directly affected by the production processes and the quality assurance programme. In addition, the unit production cost is not fixed but increases with quality assurance expenses. We present an EPQ model with imperfect production processes and quality-dependent unit production cost. After discussion of the procedure for determining the optimal solution, a sensitivity analysis of the impacts of the cost parameters on the optimal solution is provided. Finally, the problems associated with cost estimation are addressed.
Original languageEnglish
Pages (from-to)713-720
Number of pages8
JournalJournal of the Operational Research Society
Volume42
Issue number8
DOIs
Publication statusPublished - 1 Jan 1991
Externally publishedYes

Keywords

  • Economic production quantity
  • Inventory
  • Quality

ASJC Scopus subject areas

  • Management Information Systems
  • Strategy and Management
  • Management Science and Operations Research
  • Marketing

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