Question: A producer of dog food is trying to decide whether
A producer of dog food is trying to decide whether they should change the number and locations of their warehouses to better meet projected demand over the next three years. They do a study and determine that their transportation and warehousing costs will be $51 million if they stick with their current structure. They have determined that if they close two warehouses and open two new warehouses, their costs will drop to $50.5 million. Assume that all other costs stay the same. Should they make the change?
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