Question
Consider three companies SW, GR and TQ. The companies have been in the business of selling white marbles for the past several years. All three
Consider three companies SW, GR and TQ. The companies have been in the business of selling white marbles for the past several years.
All three companies operate from Chittorgarh and sell their marbles to real estate firms based in Jaipur.
The distance between the offices of the marble companies in Chittorgarh and Jaipur is approximately 400 kilometres.
All three companies transport around 36,000 kilograms of marble to Jaipur every month in trucks. However, each of them has a very different mechanism of transporting the marbles.
SW transports 36,000 kilograms of marble in one go. It books a truck space once a month and transports the entire load in a single day on a monthly basis.
GR transports 36,000 kilograms of marble in four small batches of 900 kilograms each. It books a very small number of tucks four times a month (usually every week) and transports 900 kilograms of marble every time.
TQ transports 36,000 kilograms of marble in two batches of 1,800 kilograms each. It books some trucks twice a month (usually every 15 days) and transports 1,800 kilograms of marble each time.
Recall your learning on economies of scale to determine the company that has to pay the least transportation cost per kilogram to transport marbles from Chittorgarh to Jaipur.
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