Complete the calculations for Question 2 of the case study, determining the point in level of demand (pounds) where the two alternatives are equal. (Data is below)

Question 2: At what level of demand (in pounds) per year would thee two alternatives be equal?

From the information arrived at in Question 2, complete Question 3:--graphically representing the two alternatives and the point where the Ocean and Air options would be equal.

Question 3: Graphically represent these two alternatives and their trade off point.

Question 4: In 1-2 paragraphs, summarize the following:

Which option--Ocean or Air--would be the best alternative? What criteria did you use to reach this decision?

Which option--Ocean or Air--would be the best alternative to support future growth? What additional criteria did you consider to reach this decision?

			Ocean		Air
Total Transportation Costs			150,000		290,000
Inventory Costs
Carrying			48,000		23,000
Handling			20,000		22,000
Ordering			7,000		15,000
Fixed Cost			600,000		450,000
Total Costs			823,000		800,000