(R,Q) Inventory Problem with Unknown Mean Demand and Learning.
AMC INVENTORY RESEARCH OFFICE PHILADELPHIA PA
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The author addresses a single product, continuous review model with stationary Poisson demand. Such a model has been effectively studied when mean demand is known. However, the author is concerned with managing new items for which only a Bayesian prior distribution on the mean is available. As demand occurs, the prior is updated and the control parameters are revised. These include the reorder point R and reorder quantity Q.
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