25 Georgia Atlantic Corporation needs to decide on the locations for two new warehouses. The candidate sites
Question:
25 Georgia Atlantic Corporation needs to decide on the locations for two new warehouses. The candidate sites are Philadelphia, Tampa, Denver, and Chicago. The following table provides the monthly capacities and the monthly fixed costs for operating warehouses at each potential site.
WAREHOUSE MONTHLY CAPACITY (units)
MONTHLY FIXED COST Philadelphia 250 $1,000 Tampa 260 $ 800 Chicago 280 $1,200 Denver 270 $ 700 The warehouses will need to ship to three marketing areas: North, South, and West. Monthly requirements are 200 units for North, 180 units for South, and 120 units for West. The following table provides the cost to ship one unit between each location and destination.
WAREHOUSE NORTH SOUTH WEST Philadelphia $4 $ 7 $ 9 Tampa $6 $ 3 $11 Chicago $5 $ 6 $ 5 Denver $8 $10 $ 2 In addition, the following conditions must be met by the final decision: (1) A warehouse must be opened in either Philadelphia or Denver, and (2) if a warehouse is opened in Tampa, then one must also be opened in Chicago. Which two sites should be selected for the new warehouses to minimize total fixed and shipping costs?
Step by Step Answer:
Managerial Decision Modeling With Spreadsheets
ISBN: 9781292024196
3rd Edition
Authors: Barry Render