A company ships LTL to customers in a market in the Midwest at an average cost of $40 per cwt. It proposes establishing a distribution center in this market. TL shipment costs to the DC would be $20...

A company ships LTL to customers in a market in the Midwest at an average cost
of $40 per cwt. It proposes establishing a distribution center in this market. TL
shipment costs to the DC would be $20 per cwt., the estimated inventory carrying
costs are $5 per cwt., and the local cartage (LTL) cost is estimated at $10 per cwt.
If the annual shipped volume is 100,000 cwt., what will the annual savings be by
establishing the distribution center?