The Chambers Corporation produces and markets an automotive theft-deterrent product, which it stocks in various warehouses throughout

Question:

The Chambers produces and markets an automotive theft-deterrent product, which it in various warehouses throughout the country. Recently its market research group compiled a forecast indicating that a significant increase in demand will occur in the near future, after which demand will level off for the foreseeable future. The company decides satisfy this demand by constructing new plant capacity Chambers already has plants in Baltimore and Milwaukee and has no desire to relocate those facilities. Each plant is capable of producing 600,000 units per year.
After a thorough search, the company developed three site and capacity alternatives. Alternative 1 is to build a 600,000-unit plant in Portland. Alternative 2 is to build a 600000-unit plant in San Antonio. Alternative 3 is to build a 300,000-unit plant in Portland and a 300,000-unit plant in San Antonio. The company€™s four warehouses distribute the product to retailers. The market research study provided the following data.
Warehouse Expected Annual Demand
Atlanta (AT) ............ 500,000
Columbus (C0) ............ 300000
Los Angeles (LA) ....... 600.000
Seattle ............. 400,000

The logistics department compiled the following cost table specifying the cost per unit to ship the product from each plant to each warehouse in the most economical manner, subject to the reliability of the various carriers involved.

The Chambers Corporation produces and markets an automotive thef

As one pan of the location decision, management wants an estimate of the total distribution cost for each alternative. Use the transportation method to calculate theseestimates.

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