Question: 3. A commodity is to be supplied at the rate of 200 units per day. Supplies of any amount can be had at any required

3. A commodity is to be supplied at the rate of 200 units per day. Supplies of any amount can be had at any required time, but each ordering activity costs Rs 50. The cost of holding the commodity in inventory is Rs 2 per unit per day while the delay in the supply of the item induces a penalty of Rs 10 per unit per delay of each day. Find the optimal policy

(Q, t) where t is the reorder cycle period and Q the inventory level after the reorder. What would be the optimal policy if the penalty cost becomes infinity?

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