Abstract:

The economic order quantity (EOQ) model seeks the optimal order quantity to minimize the total inventory cost, so as to solve the inventory management problem with independent demand. In this work, a modified inventory pricing model based on the EOQ model is proposed. In the presented model, the original certain demand is replaced by a perturbation demand. Different from the classical EOQ model, the goal of modified model is to find the optimal price maximum the total profit. Because the modified model has perturbation set $\zeta$, it is hard to obtain the optimal solution. We get the optimal solution by solving its robust counterpart model. In the context of low carbon, in the meantime, the government and enterprises must take positive measures to reduce carbon emissions. The carbon tax is added to the modified inventory pricing model in order to reduce carbon emission. Finally, numerical examples is provided to support that enterprises should appropriately reduce carbon emissions in order to obtain more profits under the carbon tax policy.

Key words: EOQ, perturbation set, inventory pricing, low-carbon, robust counterpart