We show that in an optimal solution of the economic lot-sizing problem the total holding cost in an order interval is bounded from above by a quantity proportional to the setup cost and the logarithm of the number of periods in the interval. We present two applications of this result.

Additional Metadata
Keywords Algebra, Cost parameters, Costs, Heuristic methods, Heuristics, Holding cost bound, Lot-sizing, Lot-sizing problems, Optimal solutions, Set-up costs, Time invariants
Persistent URL dx.doi.org/10.1016/j.orl.2008.12.006, hdl.handle.net/1765/18357
Series ERIM Article Series (EAS) , Econometric Institute Reprint Series
Journal Operations Research Letters
van den Heuvel, W, & Wagelmans, A.P.M. (2009). A holding cost bound for the economic lot-sizing problem with time-invariant cost parameters. Operations Research Letters, 37(2), 102–106. doi:10.1016/j.orl.2008.12.006