A deteriorating item's inventory policy with time-varying demand considering time value with hyperbolic discounting

To reflect the characteristics that people favor the present much more but relatively undervalue the future, and that people are eager to acquire immediate rewards, especially when future value of money is not quite assuring from capital market due to inflation and the risk of loss is potential from demand market due to deterioration, we employ hyperbolic discounting to consider time value of money for the inventory model with time-varying demand of deteriorating items. We develop inventory models with complete backlogged shortages to maximize the decision maker's total profit over a given time horizon. The framework of hyperbolic discounting provides us with the perspective from which we can analyze the inventory policy based on the assuredness of future value of money, whether it's objective from the external condition or subjective from the perception of the decision maker.