Printed in the U.S.A. ©2002 by North Atlantic Science Publishing Company 235 FILTERING AND PREDICTING THE COST OF HIDDEN PERISHED ITEMS IN AN INVENTORY MODEL

• Main Authors: Lakhdar Aggoun, Lakdere Benkherouf
• Other Authors: The Pennsylvania State University CiteSeerX Archives
• Format: Text
• Language: English
• Published: 2001
• Subjects: deterministic; i.e. each item; at the end of each epoch; North Atlantic
• Online Access: http://citeseerx.ist.psu.edu/viewdoc/summary?doi=10.1.1.487.914; http://www.mat.ub.edu/EMIS/journals/HOA/JAMSA/Volume15_3/249.pdf

This paper is concerned with a discrete time, discrete state inventory model for items of changing quality. Items are assumed to be in one of a finite number,,Q of quality classes that are ordered in such a way that Class 1 contains the best quality and the last class contains the pre-perishable quality. The changes of items ' quality are dependent on the state of the ambient environment. Furthermore, at each epoch time, items of different classes may be sold or moved to a lower quality class or stay in the same class. These items are priced according to their quality, and costs are incurred as items lose quality. Based on observing the history of the inventory level and prices, we propose recursive estimators as well as predictors for the joint distribution of the accumulated losses and the state of the environment.