Suppose we have two ways to source a product. One way is from the local supplier,...

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Suppose we have two ways to source a product. One way is from the local supplier, while a second way is from a distant supplier. The terms and parameters for each source are as given in following table: Local supplier Distant supplier $1.15 3 weeks $0.10 Cost per unit, c Lead time (no uncertainty), L Transportation cost per unit, Ct $1.00 12 weeks $0.12 Suppose demand for the component is = 500/week; o = 100/week. (Assume normally distributed demand) Suppose we have a per unit holding cost of h = $0.01/week. This applies to all inventory in the system. Compute the total landed cost per unit (equal to the procurement cost plus transportation cost plus holding cost for pipeline stock) for each source. Round to two decimal places. Suppose we have two ways to source a product. One way is from the local supplier, while a second way is from a distant supplier. The terms and parameters for each source are as given in following table: Local supplier Distant supplier $1.15 3 weeks $0.10 Cost per unit, c Lead time (no uncertainty), L Transportation cost per unit, Ct $1.00 12 weeks $0.12 Suppose demand for the component is = 500/week; o = 100/week. (Assume normally distributed demand) Suppose we have a per unit holding cost of h = $0.01/week. This applies to all inventory in the system. Compute the total landed cost per unit (equal to the procurement cost plus transportation cost plus holding cost for pipeline stock) for each source. Round to two decimal places.

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