Chapter $9$ CASE $9\mathrm{.}1$ MAQ Corporation MAQ Corporation, a major producer of consumer electronics equipment, is currently faced with a rapidly growing product line and its associated inventory problems. MAQS president, Mary Semerod, has decided to initiate a program to analyze the company's inven$-$ tory requirements utilizing different inventory techniques. The first phase of this program consists of an ABC analysis of the company's product line $($shown in the following table$).$ Ms$.$ Semerod has encountered difficulties in deciding on the appropriate criteria to use in the classification and in developing appropriate cutoff levels for each class of inventory. To solve her dilemma, Ms$.$ Semerod has contracted the services of a logistics consulting firm to perform the inventory analysis. PRODUCT # SR$101$ SR$103$ PROFIT PER UNIT $$50\mathrm{.}50330\mathrm{.}0090\mathrm{.}00$ SR$105$ SR$201877\mathrm{.}50$ SALES DATA $($ONE$-$YEAR PERIOD$)$ UNITS SOLD PRICE PER UNIT $15,000$ $$2507501,5001,600600452,250103,5009,2505007006505503,0009201001\mathrm{.}100$ SR$2031,750\mathrm{.}00$ SR$205125\mathrm{.}00$ SR$301195\mathrm{.}00$ SR$303700196\mathrm{.}00303\mathrm{.}60$ SR$305$ SR$500440\mathrm{.}00$ CASE QUESTIONS $1.$ If you were employed by the consulting firm, how would you construct your method of analysis? $2.$ What criteria would you use? $3.$ What would the cutoff levels be$?$ Be sure to provide explanations of the reasoning supporting your decisions.