Some people would say that Oliver Munday, Rocko Mamas vice president for cafe development, has the best job in the world. Travel the world to pick a country for Rocko Mamas next cafe, select a city, and find the ideal site. Its true that selecting a site involves lots of incognito walking around, visiting nice restaurants, and drinking in bars. But that is not where Mr. Mundays work begins, nor where it ends. At the front end, selecting the country and city first involves a great deal of research. At the back end, Munday not only picks the final site and negotiates the deal but then works with architects and planners and stays with the project through the opening and first years sales. Munday is currently looking heavily into global expansion in Europe, Latin America, and Asia. Weve got to look at political risk, currency, and social normshow does our brand fit into the country, he says. Once the country is selected, Munday focuses on the region and city. His research checklist is extensive, as seen in the Table 1.1. Site location now tends to focus on the tremendous resurgence of city centers, where nightlife tends to concentrate. Thats what Munday selected in Moscow and Bogota, although in both locations he chose to find a local partner and franchise the operation. In these two political environments, Rocko Mamas wouldnt dream of operating by ourselves, says Munday. The location decision also is at least a 10- to 15-year commitment by Rocko Mamas, which employs tools such as locational costvolume analysis to help decide whether to purchase land and build, or to remodel an existing facility. Currently, Munday is considering four European cities for Rocko Mamas next expansion. Although he could not provide the names, for competitive reasons, the following is known:

Table 1.1

Question 2.4. Oliver Munday has developed the following supply, demand, cost and inventory data (provided below). He has requested you to allocate production capacity to meet demand at minimum cost using the transportation method. Determine the cost of the plan. Assuming the initial inventory has no holding cost in the first period and backorders are not permitted. Use the provided information to answer the questions.