A Firm Has Established a Distribution Network for the Supply

question 56

Essay

A firm has established a distribution network for the supply of a raw material critical to its manufacturing. Currently there are two origins for this raw material, which must be shipped to three manufacturing plants. The current network has the following characteristics: $$\begin{array} { | l | r | r | r | r | } \hline \text { COSTS } & \text { Plant 1 } & \text { Plant 2 } & \text { Plant 3 } & \text { Supply } \\\hline\text { Raw material source 1 } & \$ 6 & \$ 6 & \$ 9 & 400 \\\hline \text { Raw material source 2 } & \$ 4 & \$ 7 & \$ 3 & 600 \\\hline \text { Demand } & 500 & 500 & 500 & 1500 \backslash 1000 \\\hline\end{array}$$ The firm has identified two potential sites for a third raw material source; these are identified as Candidate A and Candidate B. From A, the costs to ship would be $9 to Plant 1, $10 to Plant 2, and $12 to Plant 3. From B, these costs would be $11, $14, and $8. The new source, wherever it is located, will have a capacity of 500 units. Set up-but do not solve-this problem as though you were going to solve it with transportation problem software.

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Definitions:

Compliance

The act of conforming to a request or command, often used in legal and regulatory contexts to denote adherence to rules or standards.

Internalization

The process of integrating beliefs, values, standards, or norms into one's own cognitive structure, often influencing behavior.

Identification

Refers to the process by which individuals associate themselves with particular groups, causing those groups' values and norms to become integrated into their own self-concept.

Socialization

The process by which individuals learn and adopt the values, behaviors, and norms of a society or group.