PLEASE HELP ON THIS PROBLEM ----- OPERATIONS MANAGEMENT

1) The campus bookstore sells 4,000 sets of graduation regalia each year. Placing an order from their supplier costs $25 regardless of order quantity, so they usually place a large order (a half year's supply) at a time. It costs $5 per year to hold a cap and gown in inventory, primarily insurance costs for the highly flammable material.

What is the difference in their holding cost if they order at their optimal order quantity compared to their current policy? (10 pts.)

Note: You should calculate the optimal order quantity first.

2) A distribution center operates for a major electronics company that fulfills orders that customers make from the website. (15 pts.)

Estimated annual demand: 16,936 laptops (50 weeks per year)

Cost: $840 per laptop

Lead Time: 5 weeks

Standard deviation of weekly demand: laptops

Standard deviation of lead time: 0.9 weeks

Holding cost per unit per year: 60% of item cost

Ordering cost: $37 per order

Desired service level: 98% (z=2.05)

Calculate the reorder point and the safety stock? Note that you need to convert the annual demand to weekly demand based on 50 wks/yr.