34. The manager of a company is facing an inventory problem with regard to an item whose demand is known to be evenly distributed with an annual value of 8,000 units. The cost of placing an order is Rs 50 while the annual carrying cost of one unit in inventory is Rs 5. Because of the high carrying cost, the manager is planning to have stockouts but he does not want to lose customer goodwill. He has determined that unit shortage cost is Rs 10. Using the present information, determine,

(a) When stockouts are not permitted

(i) the optimum ordering quantity,

(ii) the total inventory cost associated with the policy ofordering this quantity.

(b) When stockouts are permitted

(i) the optimum order quantity,

(ii) the maximum level of inventory,

(iii) the optimum number of shortage units,

(iv) the total inventory cost involved with the policy, and

(v) represent graphically the inventory profile for the first three inventory cycles.