1 Understanding the EOQ Model Scenario 1: Suppose we are analyzing the weekly demand for a given product that wernges D=1,500 units with a standard deviation of op = 800 units. Each product costa $10, and incurs a holding cost of 25% per year to carry inventory. The company has an opportunity to set warehouse in the local area to avoid the international shipping costs. Each order shipped from Europe currently incurs a fixed transportation and delivery cost of $10,000 1. Considering 52 weeks in a year, what is the approximate EOQ? (1 pt) (a) 24,980 units (b) 3,464 units (c) 78,994 units 2. If the load time is four weeks in the company wants to provide its customer service level of 90%, approximately how much safety stock (20.90V) should it carry? (1 pt) (1) 1,025 units (b) 2,050 units (e) 4.100 units Scenario 2: Sappone we are waiting the manager of an office supply store. One product in the store is computer paper. The manager names that 10,000 boxes will be sold this year at a constant rate throughout the year. There are 250 working days per year and the lead-time in three days. The cost of placing an order is $30, while the holding cost is $15 per box per year. 3. How thany boxes (Q") should the manager order each time? (1 pt) (a) 200 boxen (b) 400 boxes (e) 500 boxes (d) 100 boxes 4. If the manager orders 500 boxes (instead of Q") each time he orders from his supplier, what would his total annual inventory cost be? (1 pt) (a) $3.000 (b) $4,350 (c) $3,075 (d) $3,750