Consider the following inventory situation. Demands in different periods are independent but with a common probability density function D() 5 1

0

 for 0  50. Orders may be placed at the start of each period without setup cost at a unit cost of c 10. There are a holding cost of 8 per unit remaining in stock at the end of each period and a penalty cost of 15 per unit of unsatisfied demand at the end of each period (with backlogging except for the final period).

(a) Find the optimal one-period policy.

(b) Find the optimal two-period policy.