Problem
Atilus Sports and Jump Inc. both compete in the sports apparel category. They both produce the most popular item in the category, the sweatshirt. Atilus is based in Columbus, OH while Jump Inc. is based in Jacksonville, FL. They both compete in the Atlanta, GA market. Atilus Sports' production cost is $5.75 per unit, and has inbound transportation costs of $1.25 per unit, with outbound transportation costs of $2.75 per unit. Jump Inc.'s production cost is $3.50 per unit, and has inbound transportation costs of $2.85 per unit, with outbound transportation costs of $1.50 per unit. Please use this information to answer the following:
(a.) Which of the two companies has the total cost per unit advantage?
(b.) Which of the following represents the amount in dollars that the firm with the transportation cost advantage per unit has an advantage by?
(c.) Which of the two companies has the transportation cost per unit advantage?
(d.) Which of the following represents the amount in dollars that the firm with the total cost advantage per unit has an advantage by?