To know whether domestic or foreign production is least expensive, the total of production and distribution costs must be computed from the source point to the marketplace. Two alternatives are suggested and they can be compared as follows. Producing in Taiwan would appear to be the least expensive. Whether the incentive rate should be implemented depends on the shipment size corresponding to the minimum of the sum of transportation, inven- tory, and order processing costs. These costs are determined for various shipping quantities that might be selected to cover the range of shipment sizes implied in the problem. Table gives a summary of the costs to Monarch for various shipment sizes.
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LOGISTICA. ADMINISTRACION DE LA CADENA DE SUMINISTRO E-BOOK
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