David is a shoemaker and owns 4 warehouses located at Torrance, Los Angeles, Irvine, and Riverside. In order to reduce inventories, David is considering whether he should close some warehouses to save costs The order cost is $60 per order, and the inventory holding cost is $0.27 per unit per week. You promise customers that order lead time is one week and customer service level is 95%. First, he collected the information about the demand in the past 12 weeks at these four locations 50 58 76 45 34 67 88 90 100 56 40 55 Torrance Los Angeles 34 38 45 67 90 45 22 33 4567 8990 Irvine Riverside David is using Q-system to maintain the inventory levels at four warehouses 120 | 133 | 156 | 178 | 130 | 122 | 155 | 200 | 120 | 150 | 122 | 134 15 22 333540 20221215 16 15 12. If David wants to place an order based on EOQ for Torrance warehouse, what will be the range of the order quantity? A) 50-100 pairs B) 101-150 pairs C) 151-200 pairs D) 201-250 pairs 13. What will be the range for safety stock at Torrance warehouse based on the service level required by David? A) 10-30 pairs B) 31-60 pairs C) 61-90 pairs D) 91-120 pairs 14. What will be the average inventory level at David's warehouse at Torrance? A) 61-80 pairs B) 81-100 pairs C) 101-120 pairs D) 121-140 pairs 15. David is evaluating the inventory levels with centralized warehouses. He plans to close the warehouse at Los Angeles and used the warehouse at Torrance to deal with the demand at Torrance and Los Angeles In addition, David plans to close the warehouse at Riverside and used the warehouse at Irvine to handle the demand at Riverside and Irvine. In addition, David found that the correlation of demand between Torrance and Los Angeles is -0.70 and the correlation between Irvine and Riverside is +0.12. Based on risk pooling theory, which centralized warehouse will show a larger percentage of reduction in inventory level compared with the total inventory levels before centralization? A) Warehouse at Torrance B) Warehouse at Irvine C) Both warehouses have the same reduction in inventories D) No inventory reduction will happen in either warehouse. 16. What will be the average inventory level at David's warehouse at Torrance after centralization? A) 101-120 pairs B) 121-140 pairs C) 141-160 pairs D) more than180 pairs 17. What will be the average inventory level at David's warehouse at Irvine after centralization? A) 101-120 pairs B) 121-140 pairs C) 141-160 pairs D) more than180 pairs