As long as inbound transportation economies of scale are maintained,increasing the number of facilities decreases total transportation cost.

Question

Quizplus · Accepted Answer

When inbound transportation economies of scale are maintained, adding more facilities decreases the distance that products need to travel between facilities, reducing total transportation cost. This is because a larger number of facilities allows for a more localized distribution network, which can take advantage of smaller, more frequent shipments to each facility rather than relying on larger, less frequent shipments to a smaller number of facilities.

As Long as Inbound Transportation Economies of Scale Are Maintained,increasing