Question: please answer the two questions above 7. Consider the fixed order quantity model with random demand. Suppose we use the optimal order quantity and the

please answer the two questions above 7. Consider

please answer the two questions above

7. Consider the fixed order quantity model with random demand. Suppose we use the optimal order quantity and the optimal reorder point. Which of the following statements are correct? a) The expected annual holding cost is less than the expected annual ordering/setup cost. b) The expected annual holding cost is equal to the expected annual ordering/setup cost. c) The expected annual holding cost is greater than the expected annual ordering/setup cost. d) We do not have sufficient information. 8. If the lead-time for receiving the orders from the supplier doubles, the order quantity in the fixed order quantity model a. Halves. b. Doubles. c. Increase by a factor of 2. d. None of the above

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