Question: Please include all formulas used and steps for each part. Q2. Risk Pooling and Supply Chain Contract (a) One of the benefits of pooling is

Please include all formulas used and steps for

Please include all formulas used and steps for each part.

Q2. Risk Pooling and Supply Chain Contract (a) One of the benefits of pooling is that it can reduce (1 point) A. safety stock B. overage cost C. underage cost (b) In a supply chain with one supplier and one retailer shown in the graph below. If the supplier agrees to "buy back" the unsold inventory, then this buy-back contract helps coordinate the supply chain by reducing the buyer's_ __(1 point) A. safety stock B. overage cost C. underage cost Production Cost Wholesale Price Retail Price Supplier Retailer (c) In the supply chain described in part (b). Assume that production cost is $6, wholesale price is $8 and retail price is $12. Find the best service level for the centralized system SL* (3 points). (d) Find the buy-back rate that coordinates the supply chain (4 points)

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