A Note on the EPQ Model with Shortages and Variable Lead Time

The classical optimization techniques are often used to derive and to assert the optimal solution for the well-known inventory models such as the economic order/production quantity (EOQ/EPQ) models. Recently, a new approach, without reference to the use of derivatives but with algebraic derivation, is presented to solve the above deterministic EOQ/EPQ models with/without shortages. To widen the application of this approach, this paper considers the variable lead-time EPQ model with shortages. We show that the aforementioned approach can be applied to solve not only the deterministic case but also the probabilistic case considered in this article.