What Three Logistics-Related Costs Are Relevant When Analyzing the Choice

question 137

Multiple Choice

What three logistics-related costs are relevant when analyzing the choice of number of facilities in a distribution network?

• A) inventory costs, production costs, and transportation costs
• B) inventory costs, production costs, and facility costs
• C) inventory costs, transportation costs, and facility costs
• D) facility costs, production costs, and transportation costs
• E) facility costs, inventory costs, and marketing costs

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Definitions:

Computer Chips

Small pieces of semiconductor material (usually silicon) with an integrated circuit (IC) used in electronic devices to perform computing tasks and other functions.

Negative Externality

A situation where a third party suffers costs from an economic transaction in which they are not directly involved.

Patent

A government-granted exclusive right to an inventor, allowing them the sole right to make, use, and sell an invention for a certain period of time.

Socially Optimal Outcome

A state in which a market or economy operates at peak efficiency, distributing resources in a way that benefits the maximum number of people.