Answers should be precise. No negative marking. 1. Suppose you are the procurement manager of a hospital. Explain why safety stock would be critical to ensure quality treatment at the hospital. (5 points) 2. Explain the concept of EOQ using cost-order quantity graph. (5 points), 3. Suppose you oversee procurement in a bakery store. Your daily demand is 100. Considering annual holding cost of $10/per unit/year, and ordering cost to be $40/order, what will be the EOQ. (5 points) 4. Differentiate between continuous and periodic inventory system in a supply chain with diagram. (5 points). 5. Suppose you are investing $1000 for a year, the probability that you will gain 10 percent is 0.75, and the probability you will lose 10 percent is 0.25. What is the expected value of your investment? Draw the decision tree. (5 points). 6. Calculate the two-period and four-period average forecast for the following data: (5 points) Week 1 2 3 4 5 6 7 Number of customers 200 240 260 315 320 400 300

Answers should be precise. No negative marking. 1. Suppose you are the procurement manager of a hospital. Explain why safety stock would be critical to ensure quality treatment at the hospital. ( 5 points) 2. Explain the concept of EOQ using cost-order quantity graph. ( 5 points). 3. Suppose you oversee procurement in a bakery store, Your daily demand is 100. Considering annual holding cost of $10/ per unit/year, and ordering cost to be $40/ order, what will be the EOQ. ( 5 points) 4. Differentiate between continuous and periodic inventory system in a supply chain with diagram. (5 points). 5. Suppose you are investing $1000 for a year, the probability that you will gain 10 percent is 0.75 , and the probability you will lose 10 percent is 0.25 . What is the expected value of your investment? Draw the decision tree. ( 5 points). 6. Calculate the two-period and four-period average forecast for the following data: 15 points)