Optimal Stock Depletion Policies with Stochastic Lives

This paper deals with the optimal issuing sequence of units, say batteries, from storage to the field when field lives are stochastic. Several appealing forms of the field life survival probability F̄(y∣x) are given when the battery has been on the shelf a length of time x. These forms are used to investigate the optimally of LIFO (issue youngest) or FIFO (issue oldest) policies in two basic models. These models correspond to issuing batteries either according to a possibly random schedule (the independent case) or one after another as the successive batteries fail (the dependent case).