A Perfect Algorithm for the Capacitated Lot Size Model with Stockouts
For the single-product capacitated dynamic lot size problem with stockouts, a procedure is proposed that detects the optimal first lot size at the earliest possible moment. The proposed algorithm uses the data structure of a dynamic tree, in which long run potential optimal policies are represented by paths and each production decision by a node. Starting with a horizon t = 1 the procedure successively increases t and eliminates in each iteration t all decisions that are not part of an optimal policy using data of the first t periods.
KeywordsOptimal Policy Capacity Constraint Active Node Setup Cost Production Decision
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