Consider the data for a two item inventory model given in Table 13.13. The company initially does not want to consider shortage cost but realizes that a 1% discount can be got if the order quantity is 100 units more than the EOQ for each item. It is willing to try and experiment with backorders. Verify if the discount can be accepted. Table 13.13 Data for Two Items Item A Item B Annual demand 10000 15000 Order cost Carrying cost Shortage cost 300 300 20% of Rs. 30 20% of Rs. 50 80 150