Don Levine Corporation is considering adding an additional plant to its three existing facilities in Decatur, Minneapolis, and Carbondale. Both St. Louis and East St. Louis are being considered. Evaluating only the transportation costs per unit as shown in the tables below, which site is the best?
From Existing Plants
O Decatus Minneapolis Carbondale Demand
Blue Earh $20 $17 $21 250
Ciro 25 27 20 200
Des Moines 22 25 22 350
Capacity 300 200 150
From Proposed Plants
To East St. Louis St.Louis
Blue Earth $29 $27
Ciro 30 28
Des Moines 30 31
Capacity 150 150
A. Is this a minimization or maximizaion problem? Explain
B. What would the total transportation cost be if the East St. Lous plant were opened?
C. What would the total transportation cost be if the proposed plant in St. Louis were opened?
D. Which plant would you advise Levin Corp. to open and why?