Suppose we use the Newsvendor model to find an optimal order quantity S =10. Next, suppose that we make the following changes: We increase the underage cost by $10 while the overage cost remains unchanged and the distribution for the demand remains unchanged. After this change, the new order quantity will be larger than 10. (2 marks) 3. A company uses the EOQ model to determine how much stock to order. At the current reorder point, there is a 30% chance that the company will stock out during lead time. Thus, the service level is 70%. (2 marks) 4. Consider the Newsvendor model. Assume the demand D follows a normal distribution. If the wholesale cost c increases and both the retail price p and salvage value sv remain the same, then the optimal order quantity S* will decrease. (2 marks) 5. A retailer uses the EOQ model to order sweatshirts. Assume that annual demand for sweat- shirts is normally distributed. Currently, the retailer pays C = $10 to their supplier per sweatshirt. If the supplier triples the unit cost to $30 per sweatshirt (and all other costs remain constant), then the retailer will increase its reorder point. (2 marks)