Question
A clothing manufacturer has a factory at a low-cost location and needs to ship finished clothing to retail locations. The annual demand for a particular
A clothing manufacturer has a factory at a low-cost location and needs to ship finished clothing to retail locations. The annual demand for a particular high-priced dress is 2,400 per year at one retail location. The manufacturer has the choice of shipping the products from the factory to the retail location by a private ground transportation which will take 3 days, by air with the same private company which will take 1 day or by using a public transportation company which will take 7 days. What will be the average transportation inventory for each option? Assume 300 working days per year.
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