𝔖 Bobbio Scriptorium
✦   LIBER   ✦

The truncated normal–gamma mixture as a distribution for lead time demand

✍ Scribed by J. K. Ord; U. Bagchi

Publisher
John Wiley and Sons
Year
1983
Tongue
English
Weight
293 KB
Volume
30
Category
Article
ISSN
0894-069X

No coin nor oath required. For personal study only.

✦ Synopsis

Abstract

A central problem in inventory control concerns the statistical description of total demand during the lead time between placement and receipt of an order. Since both the demand per unit time and the lead time are random variables, the distribution of lead time demand is formulated as a mixture. In application, one or both components of the mixture are often assumed to be normally distributed despite their nonnegativity. In practice, this assumption is taken to imply that a normal curve, truncated at zero, is a valid description. Several approximations to the true tail area probabilities (given truncation) are examined. In turn, this leads to an improved and simpler expression for the normal–gamma mixture. Some numerical results are also presented.

📜 SIMILAR VOLUMES

Estimating the lead-time demand distribu
Estimating the lead-time demand distribution for an autocorrelated demand by the pearson system and a normal approximation
✍ Bong-Geun An; Stergios B. Fotopoulos; Min-Chiang Wang 📂 Article 📅 1989 🏛 John Wiley and Sons 🌐 English ⚖ 764 KB

The exact first four moments of lead-time demand L are derived for an AR(1) and a MA(1) demand structures where the arbitrary lead-time distribution is assumed to be independent of the demand structure. These moments then form a basis for the Pearson curve-fitting procedure for estimating the distri