In the integrated production-shipment models for the single vendor-single-buyer system presented hitherto, the demand rate of items is treated as a constant. However, many researchers have observed that the presence of more quantities of the same product tends to attract more customers. This suggests that the demand rate should depend on the stock level. This paper presents a single-vendor-single-buyer production-shipment model with the stock dependent demand rate, based on the demand rate linearly depending upon the stock level at any instant of time.