Question
The XYZ Chemical Company must ship 9,500 gallons of pesticides from its plant in Cincinnati, Ohio, to a customer in Columbia, Missouri. XYZ has a
The XYZ Chemical Company must ship 9,500 gallons of pesticides from its plant in Cincinnati, Ohio, to a customer in Columbia, Missouri. XYZ has a contract in place with Henderson Bulk Trucking Company as well as with the Central States Railroad. Both carriers are available for the move. Henderson will charge $600 per tank truck, and Central States' rate is $1,000 per tank car round trip. Henderson trucks can hold a maximum quantity of 7,000 gallons. XYZ has a fleet of 23,500 gallon tank cars available in Cincinnati.
- Given the above information, evaluate the cost of each alternative.
- What other qualitative factors should be considered in this decision?
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Get StartedRecommended Textbook for
Managerial Economics
Authors: Paul Keat, Philip K Young, Steve Erfle
7th edition
0133020266, 978-0133020267
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