The Final Prescription

The readymade prescription for minimizing I now becomes:
(i)                  Select x at such a level that n/12 = a/(a+b) or, if a/(a+b) is not available, the next lower available value.
(ii)                If a certain range of values of x satisfies (i), choose the lowest value of x from the range. Once we set the optimal of x i.e. x0 at 45 units, the interest burden for the borrowing company over the next one year comes to (45 ´ 10% + 5 ´ 12% ´ 6/12) = 4.8 units.