Decrease in Transport Costs from Warehouse #3 by $3.50 For Warehouse #3, any decrease in transport costs affects only the binding constraints: Reducing costs affects only those already distributing materials at a positive rate. Looking at the current allocations for Warehouse #3: To Firm A: 0 To Firm B: 7 To Firm C: 6 To Firm D: 6 Since costs to Firm B, C, and D are currently non-zero, a decrease by $3.50 each would lower the cost by ( 7 + 6 + 6 ) 3.50 = 19 3.50 = 66.5 (7+6+6)3.50=193.50=66.5. (d) Reduction in Warehouse Supply Capacity by 5% explain more detailed