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Determine which shipping alternative would be most economical to ship 80 boxes of parts when each box has a price of \$200 and holding costs are 30 percent of price, given this shipping information: overnight, \$300, two-day, \$260, six-day, \$180.

• Operations management - Business -

I am wondering of your holding costs are per day or not dependent on time. It makes a big difference.

Assuming holding costs are independent of time during shipping. on a per box price..
overnight: 300
two day: 260+60
six day: 180+60
which indicates six day shipping

Assuming holding costs are per day costs
overnite: 300
two day:260+120
six day:180+360
which indicates overnite.

• Operations management - Business -

Thank you very much
i think its more likely to be dependent on time, but aren't we supposed to consider \$60 x 80 boxes??

• Operations management - Business -

P=?

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