You manage inventory for your company and use a continuous review inventory system to control reordering items for stock. Your company is open for business 300 days per year. One of your most important items experiences demand of 27 units per day, normally distributed with a standard deviation of 2 units per day. You experience a lead time on orders from your supplier of five days with a standard deviation of one day. If you order 1,700 units or less, you pay the supplier $5.70 per unit. Orders of 1,700 or more can be bought at a unit price of $5.45. Your ordering cost is $57. Your inventory carrying cost is 15 percent. You have established a service level policy of 97.5 percent on this item. Use Table 7-2. a. What is your optimal order quantity? b. What is your reorder point? c. How much safety stock do you carry? d. What is your average inventory? TABLE 7-2 Standard Deviations and Probabilities