Two locations are being considered, one in the center of the city and one on the outskirts. The central city location would involve fixed monthly costs of $7,000 and labor, materials, and transportation costs of $30 per car. The outside location would have fixed monthly costs of $4,700 and labor, materials, and transportation costs of $40 per car. The price will be $300 per car.

a. Which location will yield the greatest profit if monthly demand is 200 cars? 300 cars?

b. At what volume of output will the two sites yield the same monthly profit? LO.1