Problem $2)(18$ points$)$

Astro Industries of Minneapolis, MN$,$ makes weekly shipments to $16$ customers in the Dallas area.

Each customer's order weighs, on average, $1,250$ pounds. A direct truck shipment from

Minneapolis to Dallas costs $$1,750.$ The maximum load per truck is $25,000$ pounds.

a$)$ How much would it cost Astro to make direct, single$-$order shipments to all of its customers

each week? What would the utilization level for the trucks look like? $(5$ points$)$

b$)$ Suppose a Dallas$-$based warehousing firm has agreed to run a break$-$bulk warehousing

operation for Astro at a cost of $$120$ per hundred$-$weight. Local deliveries to each customer

would tack on another $$100$ per customer per week. How much money could Astro save

by going with the break$-$bulk solution? What would the utilization level for truck be in this

case? $(8$ points$)$

c$)$ How high would the warehousing cost $($currently at $$120$ per hundred$-$weight$)$ have to be

before break$-$bulk warehousing is no more attractive than direct shipments? $(5$ points$)$

Note: You can solve Parts a and $b$ together as we did in class practice problem.