Business, 19.12.2019 22:31, PaavanPatel
Flanger is an industrial distributor that sources from hundreds of suppliers. the two modes of transportation available forinbound shipping are ltl [less than truckload) and tl (truckload). ltl shipping costs $1 per unit, whereastl shipping cost$400 per truck each truck can carry up to 1,000 units. flanger wants a rule assigning products to shipping mode (tl orltl) based on annual demand. each unit costs $50, and flanger uses a holding cost of 20 percent. flanger incurs a fixedcost of 5100 for each order placed with a supplier. a. determine a threshold for annual demand above which tl is preferred and below which ltl is preferred. b. how does the threshold change [relative to part (a)] if unit cost is 5100 [instead of $50) with all other data unchanged? which mode becomes preferable as unit cost grows? c. how does the threshold change [relative to part (a)] if the ltl cost comes down to $0.8 per unit (instead of $1 per unit)?
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