When making lot-sizing decisions, managers often use a model horizon T that is much smaller than any reasonable estimate of the firm's future horizon. This is done because forecast accuracy deteriorates rapidly for longer horizons, while computational burden increases. However, what is optimal...

We consider the planning of production over the infinite horizon in a system with time-varying convex production and inventory holding costs. This production lot size problem is frequently faced in industry where a forecast of future demand must be made and production is to be scheduled based on...