2016 SEP.[5] Bestavision Ltd. uses 1200 units per month of an electronic component each costing Rs. 2. Placing each order costs Rs. 50 and the carrying cost is 6% per year of average inventory. (i) Find EOQ. (ii) If company gets 5% discount if it'places single order, should they accept the discount offer? (Marks 5) Ans. [(i) EOQ = 3,464 Units (ii) Company should accept discount offer because it reduces the total cost by Rs. 985 (i.e. Rs. 29,216 Rs. 28,231)]