A large distributor has 9 retail outlets. Currently each outlet manages its ordering independently. Demand at each retail outlet averages 800 per day. Assume there are 250 days per year. Each unit of product costs 100 dollars, and holding cost per unit of product per year is 12% of the product cost. The fixed cost of each order (administrative plus transportation) is 800 dollars in the decentralized system. The fixed cost of each order in the centralized system is twice of the decentralized system. Holding cost per unit are the same in the two systems.

1. How much does EACH warehouse need to order individually to minimize the total cost in the DECENTRALIZED system?

The potential answers are:

A: 5164 units.

B: 4000 units.

C: 7746 units.

D: 7906 units.

E: 4619 units.

2. How much should ALL the warehouses order together to minimize the total cost in the CENTRALIZED system?

The potential answers are:

A: 17321 units.

B: 19365 units.

C: 21909 units.

D: 12500 units.

E: 12649 units.

3. Compute the total ordering and carrying costs of ALL warehouses in the DECENTRALIZED system.

The potential answers are:

A: 557710 dollars.

B: 464758 dollars.

C: 627069 dol- lars.

D: 1224745 dollars.

E: 409878 dollars.

4. Compute the total ordering and carrying costs of ALL warehouses in the CENTRALIZED system.

The potential answers are:

A: 160000 dollars.

B: 227684 dollars.

C: 262907 dol- lars.

D: 443405 dollars.

E: 774597 dollars.

5. Compute the flow time in the DECENTRALIZED system. The potential answers are:

A: 2.44 days.

B: 1.98 days.

C: 3.23 days.

D: 2.42 days.

E: 2.89 days.

6. Compute the flow time in the CENTRALIZED system.

The potential answers are:

A: 0.97 days.

B: 1.54 days.

C: 1.52 days.

D: 1.05 days.

E: 1.4 days.