D&B, a major hardware brand, works with a manufacturer in Taiwan for a particular model of its power tools (Model S23) for sale in Europe through their distribution center (DC) near Munich, Germany. Due to the variety of power outlets across regions in Europe, Model S23 is produced in 4 variants with different power plugs and transported using air freight from Taiwan. Air freight charges $20 per item shipped and delivers regularly in 2 weeks, thanks to fixed schedules. Assume weekly demand for each variant to have independent and Normal distributions with mean and demand values as below: Variant 1 Variant 2 Variant 3 Variant 4 Mean ( + ) ( + ) ( + ) ( + ) Standard Deviation / / / / D&B uses a periodic review policy with 6 weeks between orders, and incurs a 30% holding cost for Model S23, for which the Taiwanese supplier charges $( + ) to manufacture. Throughout the question, assume a CSL of 96% (zCSL = 1.75), and 52 weeks in a year. a) [10] Calculate the safety stock required and OUL to be used for each variant. b) [15] What is D&Bs total annual cost of Model S23, including all variants? Note: Make sure to include all cost items for D&B. D&B management is considering a proposal to design a modular power plug connector so that only the base unit (device without the power plug) can be sourced from the Taiwanese supplier, and the power plug can be assembled at D&Bs own processing facility near Hamburg, Germany. Proximity of this facility to an established seaport will also enable D&B to use ocean shipping from Taiwan (instead of air freight). Ocean shipping would cost only $2 per item, but have a lead time of 10 weeks on average with a standard deviation of 2 weeks. The final assembly operation and additional transportation (from the Hamburg facility to the Munich DC) in total would cost $50 per item, but the manufacturers price would be lowered to $( ). Assume that the holding cost rate for the base unit will drop to 20%, and D&B will keep using the same periodic review policy. c) [10] Calculate the safety stock required and OUL to be used for the base unit. d) [15] What is D&Bs total annual cost of Model S23 with postponement? Does it make sense to implement the postponement idea? Note: Make sure to include all cost items for D&B. = LAST DIGIT OF YOUR STUDENT NUMBER (e.g., S012345 5; S009753 3) = compare 1-2, = compare 1-3, = compare 1-4, = compare 1-5, = compare 2-3 = compare 2-4, = compare 2-5, = compare 3-4, = compare 3-5, = compare 4-5