A heuristic approach to commodity purchasing

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Abstract

In this paper a Heuristic model is proposed for commodity purchasing. The model is based on the combined use of Dynamic Programming model and a price trend forecasting model. The proposed approach is highly efficient and is simple to use even by a layman. Performance of the proposed model is compared with that of the Dynamic Programming model. The results of the sensitivity analysis indicate that the proposed approach performs consistently better compared to that of the Dynamic Programming model. It is. therefore, believed that the proposed approach would be fruitfully utilized in designing an optimal commodity purchasing system.

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Santi B. Lahiri is a Senior Applications Development Specialist with Interactive Sciences Corporation in Braintree, Massachusetts. He has a degree in Mechanical Engineering from Jadavpur University, Calcutta, and a Post-Graduate Certificate in Statistics from Indian Statistical Institute, Calcutta. He also has a Master of Science Degree in Operational Research from the University of Strathclyde, Glasgow, Scotland. He has published/presented more than a half-dozen papers in the journals and conferences of the Operational Research Society of the U.K. and India, Computer Society of India and in the World Congress on Productivity of Sciences.

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