EOQ model considering imperfect product, temporary discount, and limited warehouse capacity

Here, we study an Economic Order Quantity (EOQ) model with temporary price discount, defective items and limited warehouse capacity. We intend to investigate a situation in retailer system in which the supplier offers a temporary discount. The retailer´s ware house capacity is limited then there ia an opportunity to rent additional warehause. We also consider a condition where lot of product transfer from supplier to buyer contains some defective products. The model is developed to help the retailer to decide whether to adopt a special or reguler replenishment policy during a temporary sales period. This model provides an optimal solution by maximizing the total inventory cost savings. A numerical example is presented to illustrate the application of the model.