a. Determine which delivery alternative would be most economical for 80 boxes of parts. Each box costs

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a. Determine which delivery alternative would be most economical for 80 boxes of parts. Each box costs $200 and annual holding cost is 30 percent of cost. Assume 365 days per year. Freight costs are:

Alternative                                     Freight Cost (for all 80 boxes)

Overnight .....................................................     $300

Two-day ........................................................      260

Six-day ..........................................................      180

b. For what range of unit cost for a box would each delivery alternative be least costly?

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Operations Management

ISBN: 9781259270154

6th Canadian Edition

Authors: William J Stevenson, Mehran Hojati, James Cao

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