Connect Online Access for Operations Management
Connect Online Access for Operations Management
14th Edition
ISBN: 9781260242355
Author: William J. Stevenson
Publisher: Mcgraw-hill Higher Education (us)
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Chapter 11, Problem 15P
Summary Introduction

To determine: The minimum cost using transportation method.

Introduction: Aggregate planning using transportation method helps to attain minimum cost using the optimal plan. The major advantage of transportation method is to achieve the optimal solution using optimal plans.

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PS.53 Brother I.D. Ricks is a faculty member at BYU-Idaho whose grandchildren live in Oklahoma and California. He and his wife would like to visit their grandchildren at least once a year in these states. They currently have one vehicle with well over 100,000 miles on it, so they want to buy a newer vehicle with fewer miles and that gets better gas mileage. They are considering two options: (1) a new subcompact car that would cost $18,750 to purchase or (2) a used sedan that would cost $12,750.They anticipate that the new subcompact would get 37 miles per gallon (combined highway and around town driving) while the sedan would get 26 miles per gallon. Based on their road tripping history they expect to drive 13,000 miles per year. For the purposes of their analysis they are assuming that gas will cost $2.93 per gallon.Question: How many miles would the Ricks need to drive before the cost of these two options would be the same? (Display your answer to the nearest whole number.) (Hint:…
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Connect Online Access for Operations Management

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