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ABC Freight operates two types of trucks. truck type 1, which has capacity 6400 cubic feet, has a fixed cost of $869 and a variable cost of $0.8 per mile. Operating costs for a trip for Truck type 2, which has a capacity of 3000 cubic feet, consist of a fixed cost of $530 and a variable cost of $1.2 per mile. For shipments of up to 3000 cubic feet, what trip distance, in number of miles, would justify using truck type 1?

Operation Management, Management Studies

  • Category:- Operation Management
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