5. Consider our basic EOQ inventory model. The demand and cost conditions are as indicated in the table below: Demand average daily demand (250 days per year) unit cost of ordering inventory unit cost of holding inventory lead time 150,000 600 $500 $5 5.00 a. In your excel file, sheet "Inventory," use the formulas presented in lecture to calculate the variables asked for in B9 through B16. This is your baseline. C. X Given supply chain disruptions, management is concerned that lead times will increase by 10 percent and the cost of ordering more inventories will increase by 10 percent. You have been tasked with assessing the inventory cost and re-order point adjustments in each of these eventualities...AND to explain your results to management. b. Increase the lead time by 10% relative to the baseline in E7. What is the impact on the optimal inventory level, x*? What is the impact of inventory cost? On Re-order points? Increase inventory costs by 10% relative to baseline in H4 (and reset lead time to 5 in H7). What is the impact on the optimal inventory level, x*? What is the impact of inventory cost? On Re-order points? d. So, if the main concern is inventory costs, what is more of an issue for management? Lead time or reorder costs? Explain your results. (Type here).

Consider our basic EOQ inventory model. The demand and cost conditions are as indicated in the table below: a. In your excel file, sheet "Inventory," use the formulas presented in lecture to calculate the variables asked for in B9 through B16. This is your baseline. Given supply chain disruptions, management is concerned that lead times will increase by 10 percent and the cost of ordering more inventories will increase by 10 percent. You have been tasked with assessing the inventory cost and re-order point adjustments in each of these eventualities...AND to explain your results to management. b. Increase the lead time by 10% relative to the baseline in E7. What is the impact on the optimal inventory level, x ? What is the impact of inventory cost? On Re-order points? c. Increase inventory costs by 10% relative to baseline in H4 (and reset lead time to 5 in H7 ). What is the impact on the optimal inventory level, x ? What is the impact of inventory cost? On Re-order points? d. So, if the main concern is inventory costs, what is more of an issue for management? Lead time or reorder costs? Explain your results. (Type here)