1. Mark Achin sells 3,600 electric motors each year. The cost of these is $200 each, and demand is constant throughout the year. The cost of placing an order is $40, while the holding cost is $20 per unit per year. There are 360 working days per year and the lead-time is 5 days. If Mark orders 400 units each time he places an order, what would his average inventory be (in units)?

2. Discuss the impact that this merger will have on the management of the firm being acquired and their employees. You as the purchaser should be concerned if management thinks that there will be massive layoffs of senior management and employees. You do not want to see this happen. You might want to be very specific here about your employment practices i.e. compensation, fringe benefits, training etc.