Consider a retailer who plans to expand his business in a new city. He can choose to build a flagship store to serve the entire city; or he can build 2 regional branch stores, each serving its own region. Weekly demand in region 1 is normally distributed with mean 2,000 and standard deviation 400. Weekly demand in region 2 is normally distributed with mean 800 and standard deviation 100. The lead time for both regions is 2 weeks. Assume a target level CSL of 0.95.

(1) How much safety stock in total will the retailer have to hold if he builds 2 regional stores?

(2) How much safety stock in total will the retailer have to hold if the retailer uses a central flagship store?