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Question 2 Rijul owns two Toys 8: Games stores: one in Evanston and one in St Paul; Minnesota. He is planning to carry a new

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Question 2 Rijul owns two Toys 8: Games stores: one in Evanston and one in St Paul; Minnesota. He is planning to carry a new version of the Shoots 8: Ladders featuring Thomas The Tank Engine. Based on The market research, he has figured out that the weekly demand at Evanston location would be normally distributed with mean of all] games and a standard deviation of 8, whereas the mean weekly demand at St Paul would be normally distributed with mean of 4D games and a standard deviation of :1. a] The supplier of the game has a leadtime of 4 weeks. How much safety stock does ons 8: Grimes needs to cariy at each location if Rijul wants to provide a cycle service level of 95%. What should he the reorder point for each location? 1:) Toys 8': Games will pay SELFS for each game and has a cost of capital of 20%. 1irifhat will be the annual holding cost due to safety stock at each store for safety stock for this game? c] Assuming That the two stores have the same fixed cost to placing an order: which store would you expect to have higher turns for this game? d]: Rijul just learned that the lead time for the game will increase from four weeks to six. He has consequently increased the RDP for each store by 50%. He argues that this will allow Toys Er Games to maintain the same cycle service level as before. Is he correct? (You don't need to calculate the new reorder points.)

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