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Inventory Analysis on a Single-Echelon Supply Chain System by Considering Carbon Emissions

In this paper we incorporate carbon emissions in the performance model for a single-echelon supply chain system. The system consists of a retailer ordering goods from a supplier to satisfy demand that follows a Poisson distribution. The source and cost of carbon emissions together with the inventory cost are included in the response function. The model is able to determine the optimum inventory policy, which includes reorder point and order quantity that take into account both costs and carbon emissions.