In the original RedBrand problem, suppose that the company could add up to 100 tons of capacity,
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In the original RedBrand problem, suppose that the company could add up to 100 tons of capacity, in increments of 10 tons, to any single plant. Use SolverTable to determine the yearly savings in cost from having extra capacity at the various plants. Assume that the capacity will cost $28,000 per ton right now. Also, assume that the annual cost savings from having the extra capacity will extend over 10 years, and that the total 10-year savings will be discounted at an annual 10% interest rate. How much extra capacity should the company purchase, and which plant should be expanded?
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Logistics at RedBrand Cost per ton of extra capacity 1000s 28 Years of opera...View the full answer
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