LLBean orders a supply of its house brand hiking boots when stock on hand drops to a given level at its shipping warehouse. Each Bean warehouse has the following profile for this product line: Table 1 Demand forecast (weekly) o demand forecast 2000 units 600 units/week 97% Desired cycle service level Supplier lead time (fixed) | Average Cost | Average Retail Price Shipping cost per order | financial & physical carry cost rate (h) 4 weeks $40 $59.99 $1000 10% a. Assume that LL Bean is considering a move to consolidate four of its regional warehouses (each identical in profile to that described above) into two centralized DCs. Report the potential inventory holdin and ordering cost savings from this move for the one item if Bean operates 50 weeks per year. Also, report any order response improvement you observe from the new plan. b. Assuming this plan is executed properly, per unit transportation shipping costs will increase from $1 per unit to $1.08 per unit. Report your analysis and recommend a final plan of action for LL. Bean.

Q: c. How much total consumer surplus will each of them receive at a price of $32?

A: Last parts C and d are answered below:

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