The Fine Garments Company has opted for the reorder point system and it has two options for transportation; by the truck and by rail. Truck transportation takes 1 week, while rail transportation takes 2 weeks of lead time. Truck transportation costs $2 per leather jacket, while by rail the transportation cost is $1 per leather jacket. It is the policy of Fine Garments to hold enough inventories to cover demand for twice the lead time. Which transportation option costs less? What is the reorder point for each option?

The decision is impacted only by the safety stock needed, transportation cost and the transit inventory cost, all other costs remaining equal.