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Question: The Superior Manufacturing Company wants to make two shipments from Dallas, Texas to Los Angeles, California. The first shipment weighs 10,000 pounds and the second shipment weighs 15,000 pounds. The carrier charges $10 per hundredweight (cwt) if the goods are shipped separately and they arrive in two days. If the goods can be consolidated into one shipment the cost would be $8 per cwt to ship them in a truckload lot, but it would cost $500 to consolidate the shipments at the carrier's warehouse and it would take three days. Which is the lowest cost approach and which approach would you select?

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M92750452

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