Gap has started selling through its online channel along withits retail stores. Management has to decide which products to carryat the retail stores and which products to carry at a central warehouse to be sold only via the online channel. Gap currently has900 retail stores in the United States. Weekly demand for sizelarge khaki pants at each store is normally distributed with a mean of 800 and a standard deviation of 100. Each pair of pants costs$30. Weekly demand for purple cashmere sweaters at each store isnormally distributed with a mean of 50 and a standard deviation of50. Each sweater costs $100. Gap has a holding cost of 25%. Gapmanages all inventories using a continuous review policy and thesupply leadtime for both products is four weeks. The targeted CSLis 95%. How much reduction in holding cost per unit sold can Gapexpect on moving each of the two products from the stores to theonline channel? Which of the two products should Gap carry at thestores and which should it carry at the central warehouse for theonline channel? Why? Assume demand from one week to the next to beindependent.