1. The order size in a store is 250 units each time an order is placed. The daily demand is normally distributed, with a mean of 20 units and a standard deviation of 6. Lead time is exactly 5 days. Holding cost is $12 per unit per year. The desired probability of not stocking out is 0.99. What is the standard deviation of demand during the lead time? How much safety stock should be carried, and what should be the reorder point? What is the total annual holding cost?

2. Each unit of A is made of two units of B, one unit of C, and two units of D. C is composed of two units of D and three units of E. Items A, C, D, and E have on-hand inventories of 5, 10, 20, and 10 units, respectively. Item B has a scheduled receipt of 12 units in period 1, and C has a scheduled receipt of 50 units in period 1. Lot-for-lot lot sizing is used for items A and B. Item C requires a minimum lot size of 40 units. Lead times are one period for all items. The gross requirements for A are 20 in period 2, 40 in period 5, and 60 in period 8. Find the planned-order releases for item A, B, and C.