12. The Purchase Manager of Sigma Company is contacted by a new supplier who offers a quantity discount on an item KR-100 being used by the company. The ordering cost is Rs 80 per order and the holding cost 25 per cent of the average inventory value, on a yearly basis. The annual demand for this item is 40 thousand units at a constant daily rate. The supplier states a price of Rs 80 per unit (which is being currently paid by the company) and a discount of Rs 4 per unit if the company would order for a least two thousand units of the item at a time. The manager is in a fix as to whether to take advantage of this discount offer. What would you suggest him? Show a comparative analysis of the cost involved in both the alternatives.