Question: I don't know how to solve this problem, please help. During the Modules we used the concept of Supply Chain Cost to Serve Analysis to

I don't know how to solve this problem, please

I don't know how to solve this problem, please help.

During the Modules we used the concept of Supply Chain Cost to Serve Analysis to determine the most cost efficient way to order and ship product (Air vs. Boat). Using the same concept, determine which method is most cost effective to process orders. Option 1 - You need to ship a product that has a value of $30. You can ship a product by rail at a cost of $100 per pallet. There are 300-items on the pallet. It takes 4-days to deliver the product to the customer's RDC. The annual carrying cost of inventory is 20-percent. Option 2 - You can ship the same product listed above by truck to the RDC. The value of the product is $30. It costs $115 to ship the same pallet by truck and you need 2-days of inventory to cover the replenishment process. There are 300-items on the pallet. Inventory carrying costs are 20-percent. 1) Calculate the total landed cost per unit of Option 1 (15-pts) 2) Calculate the total landed cost of Option 2. (15-pts) 3) Which option would you select and how much would you save/unit? Show your work below. (10-pts)

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