Problem Six: EOQ, Reorder Point, Safety Stock Kelly's Fabric Company produces and sells high-quality fabric to be used in sewing and crafting projects. The company has a production center, maintains inventory in a warehouse owned by the company, and sells the fabric in 10 storefronts. The stores are open 50 weeks in a year. Kelly's uses an EOQ model to determine the number of bolts of fabric to ship from the warehouse to the storefronts. Annual demand for the Wilmore store is approximately 50,000 bolts of fabric. The ordering cost is $125 per bolt, and the annual carrying cost is $2.00 per bolt. The purchase order lead time is 2 weeks Demand each day may vary with the following probability distribution: Total demand for one week 700 bolts Probability 850 bolts .05 .20 1000 bolts .50 1200 bolts 1400 bolts .20 .05 Required: a. Use the EOQ model to determine the optimal number of bolts of fabric to ship from the warehouse to the Wilmore store. b. At what point should the Wilmore store request bolts of fabric? c. If a customer wants a bolt of fabric and the store has none in stock, the store can expedite shipping of the fabric to the customer at an additional cost of $2.50 per bolt. How much safety stock should the Wilmore store keep on hand? Show the calculations that helped you arrive to your conclusion.