14.3

The solution to one-unit, one-period logging and road management problem was:

Minimum cost: $108,500
Ground-based logging into landing L2
Build landing L2
Build road Y4
Transport timber volume over road Y4

By performing some sensitivity analysis on the value of X2 (cell C6) 
in spreadsheet 14-3.xls, you will find that when X2 reaches a value of $50.34 
per CCF, the solution will change, indicating landing L1 should be built, 
along with road Y3, over which the volume will be transported.

This spreasheet was designed to use Solver as the LP algorithm.  To
run Solver, select TOOLS, then select SOLVER, then press SOLVE.

Here's a little manual binary search process to illustrate.  The cost for
cable logging will be $116,500 (try these calculations yourself), so any
ground-based cost over $116,500 may indicate that the cable logging system
is more appropriate from a cost perspective.  The question asked for the
specific point (ground-based logging cost) where the decision will occur.

Ground-based
logging cost
per CCF		Total cost	Decision

50.00		116,000		ground-based
55.00		123,500		cable
52.50		119,750		cable
51.00		117,500		cable
50.50		116,750		cable
50.25		116,375		ground-based
50.33		116,495		ground-based
50.34		116,510		cable

Therefore, a $50.34 ground-based cost will make cable system seem more 
attractive from a cost perspective.