asap Part B: Problem Solving Show math for credit! Problem 1: Supply Chain Analy
ID: 422240 • Letter: A
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Part B: Problem Solving Show math for credit! Problem 1: Supply Chain Analytics, Modal Analysis A company has goods in transit 365 days per year and its annual hold cost is 40%. There are 3 logistics options for shipping several crates of electronics, with a total value of $285,062.50 in US currency Total Duration Shipping Cost $2,500 Option Multi-Mode Description 3 calendar days 1. Truck to airport, 2. Air Cargo to local airport, 3, Truck to final destination 1. Train to transfer point, 2. Truck to final destination 1. Inland waterway port to destination port. 2. Truck to final destination $1,900 6 calendar days $1,500 8 calendar days 1A. Determine the best OPTION based solely on economics, (7 points) evd purd pon 6 of 10Explanation / Answer
Total cost under any option can be termed as :
Total cost = Shipping cost + Goods transit inventory cost
Goods transit inventory cost can be termed as :
Goods transit inventory cost
= Annual inventory holding cost x ( Transit days/ 365 days )
= 40% of $285062.50 x ( transit days/ 365)
= $312.397 x transit days
Therefore ,
Total cost under any option = Shipping cost + $312.397xtransit days
Therefore,
Total cost for option A = $2500 + $3 x 312.397 = $2500 + $937.19 = $3437.19
Total cost for option B = $1900 + $6 x 312.397 = $1900 + $1874.38 = $3774.38
Total cost for option C = $1500 + $8 x 312.397 = $1500 + $2499.17 = $3999.17
Since total cost under Option A is the least , it is the best option solely on economics
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