||Analysis of derivation of the transportation and production cost minimum place
This paper considers the method used by companies when determining the location of factories. This paper is organized as follow. Numerous methods for deriving the place that minimizes factory's transportation cost have been made so far. The scholars who systematically considered this method for the first time are Launhardt(1882) and Weber(1909). They devised a geometric method to obtain the place of minimum transportation cost for a factory. Thus, the section 2 explains their traditional geometric method. The section 3 clarifies this geometric method by analytical approach: The validity of the geometric method developed by Launhardt and Weber is clearly verified by the analytical approach. The section 4 explains the concept of the area of minimum production costs including transportation cost. The section 5 summarizes the results derived in the paper.