The King Corn Company processes food for sale in discount food stores. It has two plants: one in Chicago and one in Houston. The company also operates warehouses in Miami, Denver, Lincoln, and Jackson. Forecasts indicate that demand soon will exceed supply and that a new plant with a capacity of 6,000 cases is needed. The question is where to locate the new plant. Two potential sites are Auburn and Springfield. The two tables below give data on capacities, forecasted demand, and shipping costs that have been gathered. a. Foreachalternativenewplantlocation, determine the total cost of the shipping pattern that will minimize total transportation costs. Where should the new plant be located based on transportation costs?
The King Corn Company processes food for sale in discount food stores. It has two plants: one in Chicago and one in Houston. The company also operates warehouses in Miami, Denver, Lincoln, and Jackson. Forecasts indicate that demand soon will exceed supply and that a new plant with a capacity of 6,000 cases is needed. The question is where to locate the new plant. Two potential sites are Auburn and Springfield. The two tables below give data on capacities, forecasted demand, and shipping costs that have been gathered. a. Foreachalternativenewplantlocation, determine the total cost of the shipping pattern that will minimize total transportation costs. Where should the new plant be located based on transportation costs?
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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The King Corn Company processes food for sale in discount food stores. It has two plants: one in Chicago and one in Houston. The company also operates warehouses in Miami, Denver, Lincoln, and Jackson.
a. Foreachalternativenewplantlocation, determine the total cost of the shipping pattern that will minimize total transportation costs. Where should the new plant be located based on transportation costs?
Transcribed Image Text:Lincoln Jackson Capacity
$1
Miami
Denver
Chicago
Houston
Auburn
$6
$2
$8
$5
$3
12 000
$7
$3
$2
$5
7 000
$5
$2
10 000
6 000
Demand
8 000
9 000
4 000
Transcribed Image Text:Miami
Denver
Lincoln Jackson Capacity
Chicago
Houston
Springfield
$5
$6
$1
$3
12 000
$7
$5
$2
$4
9 000
$2
$4
7 000
$5
$1
10 000
6 000
Demand
8 000
4 000
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