Optimal banknote replenishing policy by an issuing bank

Research output: Contribution to journalArticlepeer-review

4 Scopus citations

Abstract

The minimal total cost replenishing policy for legal banknotes by the Bank of Israel (a ‘Federal’ Issuing Bank) was determined in three stages: (a) the market demand for banknotes of different denominations for a planning horizon of 10 years was evaluated using regression analysis; (b) the periodic supply of the banknotes to the market was estimated from the incremental market demand and the need to replace worn out banknotes; and (c) a total cost discrete Dynamic Programming model was constructed to find the optimal ordering quantities of banknotes, under the constraints of maximal storage and maximal order size capacities.

Original languageEnglish
Pages (from-to)1-12
Number of pages12
JournalInternational Transactions in Operational Research
Volume4
Issue number1
DOIs
StatePublished - 1 Jan 1997

Keywords

  • Banknote inventory
  • Banknote issuing policy
  • Banknote ordering policies
  • Banknote replacement
  • Banknote replenishment

ASJC Scopus subject areas

  • Business and International Management
  • Computer Science Applications
  • Strategy and Management
  • Management Science and Operations Research
  • Management of Technology and Innovation

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