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( a ) . The Arid Company makes boats to serve distribution centers in Pulau Langkawi, Port Dickson, and Kuala Terengganu from existing plants in

(a). The Arid Company makes boats to serve distribution centers in Pulau
Langkawi, Port Dickson, and Kuala Terengganu from existing plants in Kuala Kurau and Rompin. Arid is considering locating a plant near the headwaters of Klang. The annual capacity for each plant and the annual demand
The following two tables give data on capacities, forecasted demand, and shipping costs that have been gathered.
Table 3: Capacity and Demand
Plant Capacity(Boats/week) Distribution Centers Demand(Boats/week)
Kuala Kurau 12,000 Pulau Langkawi 6,000
Klang Rompin10,00018,000 TOTAL Port Dickson Kuala Terengganu22,00012,00040,000
Table 4: Shipping Cost
Shipping Cost to Distribution Center
Plant (per boat)
Pulau Langkawi Port Dickson Kuala Terengganu
Kuala Kurau RM 4.37 RM 4.25 RM 4.89
Rompin RM 4.00 RM 5.00 RM 5.27
Klang RM 4.13 RM 4.50 RM 3.75 Illustrate the initial solution using the intuitive lowest-cost method.
(ii). problem. State the total minimum cost. Using the stepping-stone method, report the optimal solution to this
(b). major impact on the overall risk and profit of a company. Selecting a facility Location decision is an important strategic decision because location has a
location is becoming more complex with globalisation. Identify FOUR (4) factors that affect location decisions at the site level.

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