Practical Management Science
Practical Management Science
6th Edition
ISBN: 9781337406659
Author: WINSTON, Wayne L.
Publisher: Cengage,
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Your options for shipping
​$104,800
of machine parts from Baltimore to Kuala​ Lumpur, Malaysia, are​ (1) use a ship that will take
30
days at a cost of
​$3,370​,
or​ (2) truck the parts to Los Angeles and then ship at a total cost of
​$5,030.
The second option will take only
18
days. You are paid via a letter of credit the day the parts arrive. Your holding cost is estimated at
30​%
of the value per year.
 
If you have a third option and it costs only
​$4,080
and also takes
18
​days, what is your most economical​ plan?
Part 2
The daily holding cost of Alternative 1 is
​$________.
​(Enter your response rounded to two decimal​ places.)
Part 3
The daily cost of faster shipping with Alternative 2 is
​$________.
​(Enter your response rounded to two decimal​ places.)
Part 4
The daily cost of faster shipping with Alternative 3 is
​$________.
​(Enter your response rounded to two decimal​ places.)
Part 5
 
Alternative 1?
Alternative 2?
Alternative 3?
is more economical.
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