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You are shipping 2 0 0 diamonds to a customer located 2 , 0 0 0 miles away. The average value of the diamonds is
You are shipping diamonds to a customer located miles away. The average value of the diamonds is $ You can ship via air for $ and the diamonds will arrive in two days or you can ship via a specialty ground carrier for $ and the diamonds will arrive in six days. You figure your inventory carrying cost is percent. Your customer will immediately transfer funds to your bank account on receipt of the shipment.
What is your total cost if you use the ground carrier and the air carrier?
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