A company is considering centralizing inventory from two locations to one locatic for Item X. At Location 1, Item X has an average demand of 15 units a day and a standard deviation of demand of 4 unit a day. At Location 2, Item X has an averag demand of 35 units a day and a standard deviation of demand of 4.2 units a day. T correlation of demand of Item X between Location 1 and Location 2 is 0.50. Assun demand at both locations is approximately normal. If an analyst uses the square ro law to approximate the percentage reduction in safety stock from centralizing this item, which will happen? a) The square root law will overstate the safety stock reduction from centralizing inventory. b) The square root law will understate the safety stock reduction from centralizing inventory. c) The square root law will be an accurate representation of the safety stock reduction from centralizing inventory. Question 10 (3 points) Your company has a product stocked at 7 different locations but is considering centralizing the item to one distribution center. An analyst at your company was asked to perform an analysis of expected inventory savings. The analyst did this analysis using the square root law. Which of the following is correct regarding the assumed inventory reduction from this approach? a) The assumed reduction in safety stock reported by the analyst will be a worst-case estimate. b) The assumed reduction in safety stock reported by the analyst will be the average of the best-case and worst-case estimates. c) The assumed reduction in safety stock reported by the analyst will be a bestcase estimate