Swann Company manufactures sleeping bags. A heavy-duty zipper is one part the company orders from an outside supplier. Information pertaining to the zipper is as follows:
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Economic order quantity
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4,200 units
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Average daily usage
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200 units
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Maximum daily usage
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240 units
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Lead time
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3 days
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Required:
1. What is the reorder point assuming no safety stock is carried?
2. What is the reorder point assuming that safety stock is carried?