Use the Table Below to Answer the Following Questions) Answer the Following Questions) Using a Linear Optimization Model

question 13

Multiple Choice

Use the table below to answer the following questions) .
The Riviera Transport Company RTC) produces car accessories at two plants: Dallas and Atlanta. They ship them to major distribution centers in Houston, San Jose, Jacksonville, and Memphis. The accounting, production, and marketing departments have provided the information in the table below, which shows the unit cost of shipping between any plant and distribution center, plant capacities over the next planning period, and distribution center demands. RTC's supply chain manager faces the problem of determining how much to ship between each plant and distribution center to minimize the total transportation cost, not exceed available capacity, and meet customer demand.
Assume Xij = amount shipped from plant i to distribution center j, where i = 1 represents Dallas, i = 2 represents Atlanta, j = 1 represents Houston, and so on. $$\begin{array} { | l | l | l | l | l | l | } \hline \text { Transportation } & & & & & \\\text { Model } & & & & & \\\hline & & & & & \\\hline \text { Data } & & & & & \\\hline & \text { Distribution } & & & & \\& \text { Center } & & & & \\\hline \text { Plant } & \text { Houston } & \text { Sarn Jose } & \text { Jacksorville } & \text { Mernphis } & \text { Capacity } \\\hline \text { Dallas } &13.00 & 15.25 & 10.99 & 18.48 & 1250 \\\hline \text { Atlarita } & 10.75 & 15.16 & 9.65 & 18.50 & 750 \\\hline \text { Dernand } & 175 & 325 & 480 & 950 & \\\hline\end{array}$$ Answer the following questions) using a linear optimization model.
-According to the Sensitivity report on the model, by what price should the unit cost of shipment reduce to make shipment from Dallas to Houston feasible?

• A) $8.68
• B) $2.16
• C) $10.84
• D) $3.41

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Definitions:

Cash Basis

An accounting method where revenues and expenses are recognized only when cash is received or paid.

Income Taxes Payable

Liabilities owed to the government for income taxes, not yet paid by the company.

Income Tax Expense

The total amount of income tax a company is obligated to pay to the government, reported on its income statement.

Investing Activities

Financial actions that involve the purchase of long-term assets, securities, or other investments to generate future income or value.