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Research Article

Analysis of Inventory Behavior under Demand and Lead Time Uncertainty

Jung, Chungyeong

Published: January 1985 · Vol. 15, No. 1 · pp. 131-156
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Abstract

This paper deals with the effects of the uncertainty on the inventory behaviors. The uncertainty in inventory is mainly occurred by the fluctuation of demand and lead-time. In this paper inventory behaviors are simulated by the simulation model in which demand and lead-time are generated by the random numbers, based on the normal distribution. According to the degree of uncertainty which are measured by coefficent of variance, holding and shortage of inventory are calculated in one planning horizon comprized with fifty periods. The results from the simulation experiments are used to test the hypotheses established about the inventory behaviors. The results from the statistical methods such as correlation analysis, analysis of variance, and regression analysis show the significant behaviors of inventory responding to the uncertainty of demand and lead-time.