Ordering or returning policies in single period stochastic inventory withuniform distributed demand

This paper presents an optimal inventory policy under a given stochasticdemand such as uniformly distributed demand, single-item, single period reviewinventory system. The optimal inventory control policy obtained in this paper iscalled four-point policy, that is, when inventory level of the entity is belowan ordering point, the entity orders the stock level up to a fixed level (secondpoint); when the inventory level of the entity is over a return point (thirdpoint), returns the stock level down to a fixed level (fourth point); otherwise,nothing should be done. Moreover, the optimal inventory decision functions havethe continuous order property and continuous return property. We also analyzethe (S, K)-convex properties of the cost function of the inventory. © 2009IEEE.