Questions: For both questions, use the PMExcel_general.xlsx file, which is an expanded version of the PMExcel.xlsx file from Homework 2. Suppose the inventory manager from Paper and More is using the (s,S) model with s=40 and S=120 to replenish the inventory of the Great White paper product we discussed in Session 3. This product is a non-perishable product and the supplier replenishment lead time is zero. (1) Use the spreadsheet to calculate the following performance metrics over the 50 periods when the unsatisfied demand is lost and when unsatisfied demand can be fully backordered. Fill rate In-stock rate Net profits(*) Unsatisfied demand is lost Unsatisfied demand is backordered (*) Use the first number (cell Q22). Comment on the differences you observe between the two settings (lost sales vs backorders). (2) Corsten and Gruen find that on average 45% of customers react to an out-of-stock substitution by substituting to another product - either from a different brand or the same brand (see Figure 2 on page 606). Modify the spreadsheet to incorporate this phenomenon, that is, instead of assuming that all unsatisfied demand is lost, assume that only 55% of customers are lost while 45% substitute, that is, buy another product. Recalculate the value of net profits under the extra assumption that the profit margin on the product the customers substitute to is 50 cents.